Foreclosures up, home sales down - Metro US

Foreclosures up, home sales down

August home sales were at the lowest in 20 years, and foreclosures continue to soar, leading real estate analysts to believe that consumers are still wary about the economy and the state’s job market.

“Consumer confidence waned over the summer and people got increasingly frustrated with the lingering recession, jobless recovery and stimulus programs they didn’t feel were money well spent,” says Tim Warren, CEO of The Warren Group, a real estate publisher. “When they are feeling anxious about the future of the economy, they aren’t about to buy a new home.”

August home sales dropped by 18.5 percent from August 2009, with 3,659 single-family homes sold compared to 4,492 last year, according to a report released last week by The Warren Group. This marks the first time sales in the month of August have fallen below 4,000 in more than two decades, stated the report. In addition, condo sales in August plummeted 23.3 percent from last year.

Foreclosure petitions also up

These numbers come on the heels of a study that found that foreclosure petitions in August reached the highest number in more than a year, according to a second Warren Group study. Foreclosure petitions are the first step in the foreclosure process in Massachusetts.

Warren says he predicts the sales volume will continue to be dismal in the next few months, but will likely rebound slightly in 2011. And 2010 sales may still end slightly up from 2009. This, he says, is due to the strong first quarter of 2010 bolstered by the homebuyers’ tax credit. In addition, the median home price in August jumped 3.9 percent to $315,000 — up from $303,000 a year earlier.

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