Home Sales Top Expectations

Inventories, however, unexpectedly rise and hit a new high.
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Existing-home sales came in higher than expected for October, but prices continued to drop and housing inventories spiked to a new high.

Total sales of single-family homes and condos came in at a seasonally adjusted annual rate of 6.24 million in October, up 0.5% from the upwardly revised September rate. But sales were down 11.5% from a year earlier, the National Association of Realtors said Tuesday. Economists expected a rate of 6.14 million unit sales, according to

Reuters

estimates.

"I think the takeaway is that the pace of declines we have been seeing has flattened a bit. I'm not sure we have hit a bottom, though," says Phillip Neuhart, a Wachovia economic analyst.

Sales were flat to down across the country, with the exception of the West, which showed a 6.4% gain from September to October.

Median home prices fell 3.5% year over year to $221,000. The median is the typical market price where half of the homes sold for more and half sold for less.

Total inventories unexpectedly rose 1.9% to 3.85 million homes, representing 7.4 months of supply.

The rising supply number is bad news for homebuilders like

Centex

(CTX)

and

Lennar

(LEN) - Get Report

, which are aggressively cutting prices to move new homes.

On the other hand, the stronger-than-expected sales number could be a good sign for

Realogy

(H) - Get Report

, the country's largest franchisor of residential real estate brokerage houses such as Century 21.