According to the National Association of Realtors, the sales of pre-occupied homes plummeted back in June and are projected to continue falling. Needless to say, this news is not good for the already flailing housing market—though analysts expected worse.
Federal tax credits have contributed to random bursts of sales, and recently the deadline to close purchases was extended to the end of September. Overall, the number of pre-occupied home sales dropped 5.1%.
Even though mortgage rates are extremely low these days, the number of jobless citizens and foreclosures has remained high. And while the number of sales dwindles, the number of unsold homes on the market has gone up to 4 million.
The median sale price for a home was $183,700 a 1% hike from last year’s numbers. The fall of home sales dropped nearly 9% on the West coast, 7.5% in the Midwest and 6.5 in the South. The Northeast saw their numbers jump 8%.
A freefall in sales is projected to continue over the course of the next few months. But as the supply of unsold homes gets larger, prices for homes are expected to drop even more. “Sales are likely to keep falling for three to four months,” said National Association of Realtors’ Lawrence Yun, their Chief Economist, “It’s still a fragile situation in the housing market.”
While more and more people are moving in with friends and family to save money; or opting to rent from a multi-family home or residential complex, more homes are flooding the market. More than can be sold. While there is a steady increase in foreclosed homes, the market suffers while owners look for alternatives to “deal” with being a homeowner. Interestingly, with the number of unsold homes, the government would be able to house all of the US’ homeless population and still have over 3,350,000 homes leftover.