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NATIONAL DECEMBER SALES REPORT

January 26th, 2009

The National Association of Realtors released December data today. Here are some key snippets and what they mean for Maui real estate.

Existing-home sales rose unexpectedly while inventory declined, led by a surge of sales in the West, according to the National Association of Realtors^®. Existing-home sales – including single-family, townhomes, condominiums and co-ops – jumped 6.5 percent to a seasonally adjusted annual rate¹ of 4.74 million units in December from a downwardly revised pace of 4.45 million units in November, but are 3.5 percent below the 4.91 million-unit pace in December 2007…Lawrence Yun, NAR chief economist, said home prices continue to fall significantly. “It appears some buyers are taking advantage of much lower home prices,” he said. “The higher monthly sales gain and falling inventory are steps in the right direction, but the market is still far from normal balanced conditions. Buyers will continue to have an edge over sellers for the foreseeable future.” Total housing inventory at the end of December fell 11.7 percent to 3.68 million existing homes available for sale, which represents a 9.3-month supply² at the current sales pace, down from a 11.2-month supply in November.

Nationally it is clear the market is beginning to work. The fact that for sale inventory declined to well under ten months in this challenging environment is clearly very positive news. What about the markets closes to Maui?

Existing-home sales in the West jumped 13.6 percent to an annual rate of 1.25 million in December and are 31.6 percent higher than a year ago. The median price in the West was $213,100, down 31.5 percent from December 2007.

So not only are sales up considerably year over year, but they are even up dramatically month over month. We suspect prices are down because foreclosure sales are dominating the California market. According to Bank of Hawaii Research, Maui real estate activity usually follows Orange County trends by about six months. So there is reason to believe we should see more activity in the near-term.

NATIONAL DECEMBER SALES REPORT

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