Oversupply of homes for sale reaches 22 year high

Source

WASHINGTON (MarketWatch) -- Sales of existing homes fell for an eighth straight month in October even as more properties came on the U.S. housing market, driving the supply of homes up for sale to the highest level in 22 years, the National Association of Realtors reported Wednesday.

The following facts and figures are staggering...

• The inventory of unsold homes rose by 1.9% to 4.45 million, representing a 10.8-month supply, the highest in at least eight years.

• For single-family homes alone, the inventory of 10.5 months is the highest since July 1985.

• Sales are down 20.7% in the past year and are down 31% from the peak of 7.21 million two years ago.

• The median sales price fell 5.1% in the past year to $207,800. That's the largest year-over-year price decline ever recorded.

This is the part that makes me giggle like a school girl:

As bleak as the data are, the fundamentals of the market don't support a further decline in sales, according to NAR chief economist Lawrence Yun, who said low mortgage rates and job growth should keep sales from falling. While the subprime mortgage market has disappeared, the Federal Housing Administration is picking up its lending.

"I don't anticipate any further major sales declines," Yun said.

Someone needs to give Yun a lesson in supply and demand. Heres one for starters: when you have a record amount of supply, and virtually no demand, prices are going to continue to fall. period.

Never trust a Realtor!