The pace of existing home sales slowed in the first quarter by almost 7 percent compared to a year ago, the National Association of Realtors said Tuesday.
In the latest indication of the housing market’s slowdown, the NAR said home sales reached a 6.4 million annual rate compared to 6.9 million in the same quarter of 2006.
The report came on the same day that RealtyTrac Inc., an industry research firm, said mortgage lenders foreclosed on 62 percent more U.S. homes in April than a year ago.
“We expect foreclosure activity to at least stay above last year’s levels for the remainder of 2007, fueled by a combustible mix of risky loans taken out in the last few years — many in the subprime market — and slowing home price appreciation,” James Saccacio, chief executive officer of Irvine, Calif.-based RealtyTrac, said in a prepared statement.
Home prices are also still falling. The national median existing single-family home price in the first quarter was $212,300, down 1.8 percent from a year ago when the median price was $216,100, according to the NAR’s quarterly survey of housing market conditions. The median is a typical market price where half the homes sold for more and half the homes sold for less.
At least part of the decline in the median prices of homes is because sales have shifted away from more expensive homes, a release from the NAR, a realtors trade group, said.
There are some signs of hope in the housing market. Existing home sales rose at a 2.4 percent higher annual rate than in the final quarter of 2006. Fourteen states and the District of Columbia showed an increase in the rate of home sales last quarter compared with only six states showing gains a quarter earlier, the NAR said.
“It appears the worst of the price correction is behind us,” said Pat V. Combs, NAR’s president and vice president of Coldwell Banker-AJS-Schmidt in Grand Rapids, Mich., in a prepared statement.
Regionally, existing home sales took the biggest hit in the West, where the sales pace fell 11.9 percent to an annual rate of 1.3 million units and the median home price was 1.8 percent below a year ago at $336,200.
Existing home sales in the South fell 7.3 percent to an annual rate of 2.5 million units and the median home price was $177,800, just 0.6 percent below a year ago.
In the Midwest, existing home sales fell 6.1 percent to a pace of 1.5 million units. The median single-family home price was $154,600, down 2.8 percent from a year earlier.
The Northeast fared the best with sales rising at a 1.2 percent annual rate to 1.1 million units last quarter with a median price of $268,900, down 2.5 percent from a year ago.
As home prices slump, there has been a jump in the number of borrowers unable to meet higher payments and unable to sell their homes.
Irvine, Calif-based RealtyTrac said foreclosures in April spiked to 147,708, compared with 91,168 in 2006, as lenders moved to repossess one of every 783 homes. The April figure was 1 percent lower than in March, when foreclosures hit a two-year high.
Nevada, Colorado, Connecticut, California and Ohio had the highest foreclosure rates nationwide, RealtyTrac said.
Foreclosures — defined by RealtyTrac as default notices, auction sale notices and bank repossessions — have been rising nationwide, partly due to too many loans given to people with shaky credit. And during the real estate boom of the past few years, many so-called subprime borrowers were issued adjustable-rate mortgages that are now beginning to reset at higher rates.