Sales of existing homes rose from January to February in an unexpected boost for the slumping U.S housing market as buyers took advantage of deep discounts on foreclosures. The National Association of Realtors says sales of existing homes grew 5.1% to an annual rate of 4.72 million last month, from 4.49 million units in January. It was the largest sales jump since July 2003. Sales had been expected to fall to an annual pace of 4.45 million units, according to Thomson Reuters. The median sales price plunged to $165,400, down 15.5% from $195,800 a year earlier. That was the second-largest drop on record.
February’s median sales price was up slightly from January, which recorded the lowest median price since September 2002. Prices are down about 28% from their peak in July 2006. In contrast with the housing boom, when buyers took out ever-riskier loans and maxed out their home equity lines, “homebuyers are not over stretching” says Lawrence Yun, the Realtors’ chief economist. “They want to stay within their budget.”
