Sales of existing homes fell in December, closing out a year for housing in which sales of
single-family homes plunged by the largest amount in 25 years. The median home price
dropped for the entire year, the first time that has occurred in four decades. The National
Association of Realtors reported that sales of single- family homes and condominiums
dropped by 2.2 percent in December to a seasonally adjusted annual rate of 4.89 million
units.
For the year, sales of single-family homes were down by 13 percent, the biggest drop
since a 17.7 percent plunge in 1982. The median price for a single-family home dropped
1.8 percent to $217,000. That was the first annual price decline on records going back to
1968. Lawrence Yun, the Realtors' chief economist, said it was likely that the country has
not experienced a decline in housing prices for an entire year since the Great Depression
of the 1930s.
For December, sales were down in all regions of the country. Sales fell by 4.6 percent in
the Northeast, 1.7 percent in the Midwest, 1 percent in the South and 2.1 percent in the
West. The inventory of unsold homes dropped by 7.4 percent, raising hopes that backlogs
that had hit record levels were starting to be reduced, a key factor necessary to prompt a
rebound in the market. While Yun said he expected sales to start to rebound this spring,
other analysts said housing is likely to remain in the doldrums throughout most of 2008.
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