THE NUMBER of existing homes sold in the US in recent years has been revised down by about 14 per cent, further indication that the property market downturn was worse than originally thought.
The National Association of Realtors said that it had revised downward home sales and inventory figures for the 2007 to 2010 period. Under the new benchmark, there were about 4.2 million purchases of existing homes last year, roughly 15 per cent fewer than the 4.9 million the trade group previously reported.
The group blamed the disparity on inconsistencies in data. The Realtors group has been under fire from housing experts and rival data providers for its rosy figures. The revisions come after months of criticism.
A few bright spots in the revisions could be found in the new inventory figures and recent sales data.
There were about 2.6 million homes for sale in the US at the end of November, the trade group said. The previous month the organisation reported about 3.3 million homes for sale. Fewer homes for sale could help lead to a rebound in property prices, though experts caution that the slumping market still has a ways to go before it is fully healed.
The glut of homes on the market has suppressed house prices and weakened the market for the construction and sale of newly built homes. The median existing-home price was $164,200 in November, a 3.5 per cent discount from the same period last year.
Home sales increased 4 per cent last month compared to October to the highest level since January, according to Royal Bank of Scotland economists. Capital Economics said that the jump in purchases suggests that a “modest recovery may be under way”.
“If we look at the most recent data, we see a pattern of steady but moderate price declines and gradually recovering sales volumes,” noted John Ryding and Conrad DeQuadros of RDQ Economics, a research group.
Data released earlier this week showed that the gloomy mood in US housing construction might be improving slightly with sentiment among homebuilders rising and the number of housing starts increasing as well. – Copyright The Financial Times Limited 2011
