Home Sales Rise in July as Prices Fall

Existing-home sales improved slightly in July, but inventories spiked to record levels as housing prices continue to fall.

Existing-home sales rose 3.1% from June to July to an annualized rate of 5 million units, the National Association of Realtors said on Monday. The sales rate was 13.2% below a year ago. The national median sales price fell 7.1% from last year to $212,400.

Inventories spiked 3.9% from last month to a record 4.67 million homes for sale at the end of July. This represents 11.2 months of supply at the current sales pace. The rise was due to a sharp increase in condo inventory, as single-family supply declined, the NAR said.

The report sent homebuilder stocks down in recent trading Monday morning. Toll Brothers (TOL Quote), KB Home (KBH Quote) and Centex (CTX Quote) were each down about 1% to 2%. The SPDR S&P Homebuilders (XHB Quote), an exchange-traded fund that tracks the sector, was down 1.3%.

Sales across the U.S. were still sharply down from a year ago, but most regions showed improvement from June to July.

The West region of the country showed strength, with home sales rising 9.7% from the previous month, but prices in the region were down a whopping 22.2% from a year ago.

Sales rose 5.9% in the Northeast from last month, while prices were down 5.9% from last year.

In the Midwest, sales inched up 0.9%, with prices up 1% from a year ago.

Sales in the South fell 0.5% from last month, while prices were down 3.5% from a year ago.