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JANUARY HOME SALES SLIP; HIGHER LEVELS EXPECTED IN MONTHS AHEAD

 JANUARY HOME SALES SLIP; HIGHER LEVELS EXPECTED IN MONTHS AHEAD
 WASHINGTON, Feb. 27 /PRNewswire/ -- Sales of previously owned homes took a temporary dip between December and January, but activity is expected to increase notably in the months ahead, according to the National Association of Realtors.
 The association recorded a seasonally adjusted annual sales rate (A) of 3.22 million existing single-family homes nationwide in January, 1.5 percent below the December rate of 3.27 million units. However, January's resale rate was significantly higher than that for one year ago, jumping 12.6 percent from the January 1991 rate of 2.86 million units.
 "Sales eased up a bit, but, overall, the market is in much better shape than it was a year ago," said NAR President Dorcas T. Helfant.
 Generally, the beginning of the year is a slow time for home sales, since fewer buyers are in the market during the post-holiday season, she pointed out. "Usually, the people out buying homes right after the holidays are the ones who don't have to take a breather from spending," Helfant said. Additionally, consumer uncertainty over future employment likely kept some potential buyers out of the market, she said. "When people are worried about their jobs, they don't take on more debt," she added.
 January's slight rise in mortgage rates may have caused some prospective buyers to delay their purchases, but Helfant said the rate increase was not significant enough to cause a massive stall in activity. The Federal Home Loan Mortgage Corp. reported that the national average commitment rate for 30-year, conventional, fixed- rate mortgages ranged between 8.23 percent during the first part of the month to 8.68 percent by the month's end. The uptick followed steady declines throughout last fall, during which rates reached their lowest point since the mid-1970s.
 "Even with the increase, rates have remained extremely low," Helfant said. She cautioned against "reading too much" into the slight sales drop between December and January. Favorable mortgage rates have continued to draw a steady number of home shoppers, including "lookers" who will buy later, as well as people who actually placed homes under contract, she noted.
 A national telephone survey of 15 large real estate companies taken by NAR in early February showed a substantial increase in contracts signed for closing later this year. The survey results hint that a nationwide jump in activity could come as early as the spring, Helfant said.
 "The housing market appears to be solidifying," she said.
 An increase in the national median existing-home price between December and January reflects a larger volume of homes purchased in the higher price ranges. The national price was $102,300, which was 2.0 percent above the December price of $100,300. The price increase indicates that more purchases were made by repeat buyers in January than in previous months, which had been dominated by entry-level activity. "First-time purchases have begun to jump-start the trade- up market," she noted. January's price was 6.3 percent higher than that for one year earlier.
 On a regional basis, the Midwest was the only region posting a resale pace increase between December and January. However, all of the regions recorded resale rate increases from January 1991.
 The resale rate in the Midwest was 920,000 units in January, up 8.2 percent from December's rate of 850,000 units, and up an extraordinary 21.1 percent from January 1991. The median existing- home price in the Midwest was $80,300 in January, up 2.7 percent from December's price of $78,200, and up 7.8 percent from January 1991.
 In the Northeast, January's resale rate of 490,000 units was unchanged from December, but jumped 19.5 percent from January 1991. The median price in the Northeast was $140,900 in December, up 2.6 percent from $137,300 in December, and up 4.7 percent from January 1991.
 The South posted a resale rate of 1.14 million units in January, which dropped 7.3 percent from the December pace of 1.23 million units. However, the pace was 4.6 percent above that for January 1991. The region's median price was $89,000, down a marginal 0.4 percent from $89,400 in December, but up 4.8 percent from a year ago.
 In the West, the rate of existing-home sales fell 5.6 percent between December and January, from 710,000 units to 670,000 units. But, the rate was 11.7 percent above that from one year ago. The median price in the West was $152,400 in January, up 6.4 percent from $143,200 in December, and up 3.2 percent from January 1991.
 There were 2.53 million existing single-family homes available for sale nationwide in January, representing a 9.4-month supply based on last month's resale rate.
 The National Association of Realtors, "The Voice for Real Estate," is the nation's largest trade association, representing more than 750,000 members involved in all aspects of the real estate industry.
 (A) The annual rate for a particular month represents what the total number of actual sales for a year would be if the relative resale pace for that month were maintained for 12 consecutive months. Seasonally adjusted annual rates are used in reporting monthly data to factor out seasonal variations in resale activity. For example, home sales volume normally is higher in the summer and relatively light in the winter months, primarily because of differences in the weather.
 -0- 2/27/92 p
 /CONTACT: Trisha Morris, 202-383-7560; Liz Duncan, 202-383-1043; or Lois Clinton, 202-383-1016, all of the National Association of Realtors/ CO: National Association of Realtors ST: District of Columbia IN: SU: ECO


MK -- DC004 -- 3122 02/27/92 09:20 EST
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Date:Feb 27, 1992
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