In a report prepared by The National Association of Realtors and published by the Associated Press sales of existing single-family homes and condominiums dropped by 0.3 percent to 5.99 million units in May, the slowest sales pace since June 2003. The National median price of a home sold last month dropped to $223,700, down 2.1% from a year ago. It marked the 10th straight price decline compared with a year ago - the longest stretch of weakness on record.
While sales declined from April to May in most sections of the country, results in Maine were a little more encouraging. Although time-on-market continues to be longer than previous years, home sales in Cumberland County improved a robust 18% as an additional 57 units were sold. The median single family home price remained relatively flat at $249,900 compared to $249,400 the previous month. In York County home sales decreased 1% as 245 total units were sold. Median single family home prices increased 5.6% to $245,450 in month to month comparison.
May 2007 sales results for both counties were signficantly behind May 2006, as the high level of inventory continues to hamper overall sales performance. Cumberland County May 2007 sales were 15% lower than the previous year while York was 22% lower.
In a troubling sign for the future, the inventory of unsold homes rose by 5 percent nationwide to 4.43 million units in May, a level that would take 8.9 months to clear out at the May sales pace. That is the highest inventory level since the last deep slump in housing in 1992.
Analysts said housing is being hurt currently by high inventories and the recent crisis in subprime mortgages, which has caused lenders to tighten their standards, making it harder for potential buyers to qualify for loans. They said all of the housing troubles seem to be causing a crisis in confidence, making people delay decisions to buy homes. “I think psychological factors are currently the biggest drag on the housing market, in addition to a disruption from tighter credit for subprime borrowers,” said Lawrence Yun, senior economist with NAE.
Posted by: Michael Sosnowski
Categories:
Maine Real Estate