Home sales inched about 3 percent higher in the Western region of the country last month, as homebuyers set out to take advantage of temporary government tax incentives and lock in still-low mortgage interest rates.
The modest annual increase benefited from an easy comparison to January 2009 sales, which cratered in the wake of the U.S. financial crisis. Nationally, sales rose 7 percent from January last year, without adjusting for seasonal factors, the National Association of Realtors said Friday. The median price was flat at $164,700.
In the West, the median price by nearly 6 percent to $203,400. Home sales surged across the 13-state region for much of last year, powered largely by homebuyers and investors snapping up bank-owned properties in California, Arizona and Nevada. Sales fell nationally around 33 percent from December and by nearly a quarter in the West, however. “Sales have been dropping … but they’re not dropping as quickly as they have been in the rest of the U.S.,” said Celia Chen, senior director at Moody’s Economy.com. Some of that decline was likely seasonal, but also a decline in the number of buyers racing to qualify for an $8,000 first-time homebuyer tax credit. Lawmakers ultimately extended the deadline to April 30 and added a $6,500 incentive for repeat buyers, taking some of the urgency out of the deal-making.
Another factor for the sequential dip in sales was the inventory of homes for sale has been shrinking. The supply of homes on the market in the West fell in January to 6.3 months from 8.7 months a year earlier, according to the National Association of Realtors. “California sales were down due to lower inventory in the lower price ranges,” said Lawrence Yun, the trade group’s chief economist.