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Repo Homes for Sale Helped Drive Jump in House Resales

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By : John Cutts    99 or more times read
Lower-priced repo homes for sale helped drive the increase in house resales nationwide in March, based on figures released by the National Association of Realtors.

Sales of previously owned single-family homes, townhouses, condos and co-ops increased in March by 6.8 percent to an adjusted annual rate of 5.35 million housing units, compared to the adjusted rate of 5.01 million units in February. The number also marked a jump of more than 16 percent from the adjusted rate of 4.61 million units in March last year.

Many economists point to home purchases by first time home buyers taking advantage of the federal tax credits as a major driver in significant increases in houses sales nationwide over the past nine months.

They consider the tax credit program as a smashing success as it was able to preserve about $1 trillion worth of middle class residential units in the hands of buyers that purchased and occupied them. Analysts contended that without the federal tax incentives, a large portion of middle class housing would have been abandoned and left to deteriorate.

It was reported that first time home buyers purchased 44 percent of overall homes sales in March, a jump from 42 percent in February. Investors bought 19 percent of total house sales while the rest were purchased by repeat buyers.

Repo homes for sale and short sales accounted for 35 percent of total home sales in March, the same percentage of distressed sales in the previous month. The percentage of cash purchases also remained high at 27 percent, as the percentage of home sales to repeat buyers and investors accounted for a huge portion of total sales.

Despite the still high percentage of distressed sales, the sales price median for all types of pre-owned homes sold in March jumped up to $170,700, an increase of 0.4 percent from the median in March last year.

Economists are confident that the return of home buyer confidence and the stabilization of home prices will be able to offset the expiration of the federal tax credits.

The median price for single-family homes in 14 of 20 metro areas increased in March year-over-year, with double-digit increases in Boston, San Diego, Saint Louis and two other metro areas.

Among the four major regions of the U.S., the price impact of repo homes for sale was greatest in the West, where the sales price median dropped by almost 8 percent year-over-year to $209,400.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.

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