Existing-home sales continued to decline in September, falling 1.9% from August, but the National Association of Realtors indicated that the worst may be over for the troubled housing market.
Existing-home sales came in at a seasonally adjusted annual rate of 6.18 million units in September, down from 6.30 million in August, the NAR said Wednesday.
Economists expected sales at an annualized rate of 6.25 million homes, according to
The sales rate was 14.2% below the 7.20 million-unit pace in September 2005, which was the strongest month on record.
"Considering that existing-home sales are based on closed transactions, this is a lagging indicator and the worst is behind us as far as a market correction -- this is likely the trough for sales," David Lereah, the NAR's chief economist, said in a statement.
"When consumers recognize that home sales are stabilizing, we'll see the buyers who've been on the sidelines get back into the market, and sales will be at more normal levels in the wake of the unsustainable boom that we saw last year," said Lereah, noting that sales already are improving in some areas.
Prices continued to drop. The national median existing-home price for all housing types was $220,000 in September, 2.2 % below the median of $225,000 in September 2005. The median is a typical market price where half of the homes sold for more and half sold for less.
Total housing inventory levels fell 2.4% at the end of September to 3.75 million, representing 7.3 months of supply at the current sales pace.
In general, the level of inventory across the country remains very challenging for homebuilders like
reported earnings Tuesday.
Inventories have doubled or tripled in areas like Phoenix and the Inland Empire region of Southern California, Centex CEO Tim Eller told investors on the company's earnings call Wednesday morning. However, in areas like Minneapolis and Dallas, inventory is only slightly higher or flat from last year.
Eller noted, however, that the company's cancellations rates are starting to come down in Sacramento and elsewhere in Northern California -- once red-hot sales market that experienced a glut of homes for sale in recent months. This could be a sign that inventories are stabilizing and will begin to eventually drop, Eller said.
Areas that were strong in the second quarter -- such as the Pacific Northwest and the coastal Carolinas -- are now deteriorating because of the large stock of existing homes for sale, Eller said.
Shares of other homebuilders moved higher Wednesday after the existing-home sales report.
was up 38 cents, or 1.3%, to $29.98;
climbed 88 cents, or 2%, to $45.20; and
was up 70 cents, or 1.5%, to $47.04.