U.S. sales of previously owned homes drop 16.7% in December

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Sales of previously owned homes in the U.S. tumbled 16.7% in December, according to a report.

The National Assn. of Realtors said this morning the number of previously owned, single-family homes, town homes, condominiums and co-ops sold fell to a seasonally adjusted annual rate of 5.45 million units in December from 6.54 million in November.

That remains 15% above the level of 4.74 million units in December 2008. Regionally, the West fared better than other parts of the country, with a 4.8% sales decline, and a separate report by the research firm MDA DataQuick released last week showed Southern California’s market gaining ground.

Analysts and housing experts had been expecting a drop in December as a tax credit for first-time buyers had buyers rushing to finish deals before an initial Nov. 30 deadline.

That credit in November was extended through April and expanded to include some buyers who already owned a home. Expanding the incentive appears to have had little effect nationally.

Lawrence Yun, chief economist of the Realtors group, said home sales were likely to pick up again in April once the new deadline approached.

“We’ll likely have another surge in the spring as home buyers take advantage of the extended and expanded tax credit. By early summer, the overall market should benefit from more balanced inventory, and sales are on track to rise again in 2010,” he said in a statement. “However, the job market remains a concern and could dampen the housing recovery – job creation is key to a continued recovery in the second half of the year.”

The national median price for all previously owned homes was $178,300 in December, 1.5% higher than in December 2008. The median is the point at which half the homes sold for more and half for less.

-- Alejandro Lazo