Sales of existing homes in the West edged higher overall in July, as many buyers took advantage of falling prices in foreclosure-ravaged areas in California, Nevada and elsewhere, according to two reports Monday.
About 1.1 million preowned houses and condominiums were sold last month in the 13-state region, up almost 1 percent from the same month last year, according to the National Association of Realtors. But the median home price in the West plunged by more than 22 percent versus a year ago to $273,200, the association said.
Nationally, existing home sales rose 3.1 percent to a seasonally adjusted annual rate of 5 million units, up from June’s downwardly revised rate of 4.85 million units. Sales had been expected to rise by only 1.6 percent, according to economists surveyed by Thomson/IFR.
“The process of a recovery has begun,” said Joel Naroff, president of Naroff Economic Advisors. “It’s not going to be short and swift, but it’s begun nonetheless.”
The increase was fueled by deeply discounted properties in parts of the country hit hardest by the housing bust.
However, the number of unsold properties hit an all-time high, the latest indication that the worst housing slump in decades is far from over. Prices nationwide are not expected to hit bottom until early next year.
The Western region, where sales of foreclosed homes are translating into sharp price declines, was clearly a large drag on the overall market.
Five Western metropolitan areas — Los Angeles, San Diego, San Francisco, Phoenix and Las Vegas — were among the top 10 markets with the steepest median home price declines in the nation last month, according to The Associated Press-Re/Max Monthly Housing Report, which analyzed all home sales recorded by all local agents, regardless of company affiliation.
The Las Vegas metro area, where foreclosures have flooded the market since last year, was the hottest market in the country last month, according to the AP-Re/Max report.
Sales almost doubled versus a year ago, and rose 16 percent from June. The median home price, meanwhile, tumbled 25 percent to $220,000 versus a year ago.
“I think our market has probably reached its bottom,” said Rosa Herwick, a broker and owner of Century 21 JR Realty in Henderson, Nev.
In the Los Angeles metro area, sales surged by nearly 31 percent last month compared to a year earlier. The median home price fell to $335,000, a drop of nearly 35 percent from July 2007, according to the AP-Re/Max report.
Elsewhere in California, San Diego saw sales jump 8.3 percent, while San Francisco’s sales rose 3.1 percent.
Elsewhere in the West, sales remained on a downward track last month, reflecting the broader, national housing slump.
Seattle and Portland, Ore., were among the top 10 metros in the nation with the most pronounced drop in home sales.
Sales also fell in Denver, Honolulu, Salt Lake City, Albuquerque, N.M., Billings, Mont., Boise, Idaho, and Anchorage, Alaska.
“We’ve basically been going through this standoff between buyers and sellers,” said Michael Tenore, district director the Seattle area for ZipRealty Inc. “We’re just seeing more and more increases in inventory and sales coming down.”
Tenore said buyers are looking for big discounts, but many sellers remain reluctant to lower prices — although that’s changing.
The median home price in Seattle fell to $340,000 last month, a drop of 6.9 percent from a year ago, according to the AP-Re/Max report.
“I can’t buy another house until I sell my house up there,” said Stephanie Kuhn, who moved to Orlando, Fla., because of a family emergency, but has yet to find a buyer for her condo in the Mount Lake Terrace suburb of Seattle.
The two-bedroom, 1,100-square-foot condo has been on the market since March, but is drawing little interest.
Kuhn, stuck with mortgage payments and now rent for her apartment in Florida, has lowered her asking price from $239,000 to $224,900. She’s even offered to throw in $1,200 to help the buyer pay the homeowners association fees.
Fearing she won’t be able to sell the unit soon, Kuhn, 47, is considering renting it out or walking away.
“I can’t keep paying out on a mortgage for an empty house,” Kuhn said. “Nobody is even looking at it.”