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Median Home Prices: $30,300 LOWER
Sales Went Up Because Prices Went Down
Talk about good news/bad news.
The good news is that September data for existing home sales came in way above the consensus estimate. The 5.18 million sales (seasonally adjusted) were the most of any month in 2008 so far, and represent the largest monthly increase in five years.
This should have been today's lead news story, ahead of even the dismal week in the stock market. Alas, the reason existing home sales went all but unnoticed is because of the bad news in the data, to wit: the selling price of existing home fell sharply. The September decline was 9% nationally, to a median price of $191,600. The 18.5% decline in the West was especially brutal.
You probably connected the dots already, and it's as simple as this: existing home sales were up because existing home sale prices were down. People in a position to buy were getting bargains from people who wished they were not in the position of having to sell. The National Association of Realtors estimates that "distressed sales" in September comprise "about 35 to 40% of total sales nationwide."
Not to make light of real "distress," it seems to me that apart from super-wealthy homeowners, any homeowner who needs to sell would find this a distressing environment. In 2006 the median sale price of existing U.S. homes was $221,900, or $30,300 higher than today -- so if your home price was anywhere close to that 2006 median (as mine was), that's how much poorer we are.
Earlier this week there was talk about a second "stimulus" plan, not unlike the one earlier this year that sent most households "rebates" that ranged from $300 to $1200. Whoopee. If the second one happens, my rebates put together won't amount to 10% of the decline my home value has seen.
I won't ask who I'm supposed to see about making up the difference. If you're like me, you've already realized that you have to look after your
own finances. We can help:
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