US Home Sales at Stake

It has been found that the home prices in four out of the five cities of United States have declined heavily in the third quarter. The low cost foreclosures have swamped the real estate market of US. This has affected the whole country very badly. According to the survey conducted by a trade group, out of 152 metropolitan areas, 120 areas have seen declines in the median sales price. On a national basis, the home sales have fallen by nearly 8 percent during the third quarter in comparison to what it was a year back. The sales activity of distressed and foreclosed properties has made for nearly 40 percent of the real estate transactions in the third quarter. It has brought down the median price of homes to $200,500.

However, the median homes price in the states of Arizona, Nevada, Virginia, and California has not fallen as is the case with other places. In these four states, the buyers were successful in snapping up the homes facing foreclosure at a bargain. According to real estate expert Charles McMillan, “A very large proportion of distressed home sales are taking place at discounted prices compared to more normal conditions a year ago,”

This holds very true for places such as Riverside and Sacramento of California. Here the price of homes has gone down respectively by 39 percent and 37 percent from what the figure was a year back. It has been found that these two cities of California had the maximum decline in its annual price. It is being envisioned that the foreclosure listing is going to be over million by the close of this year. There will be a large number of bank owned properties piled up in the real estate market. This will likely represent nearly a third of all the ‘for sale’ properties in the United States. The decline in home values together with the strict lending standards and a sluggish economy is badly sinking the real estate market.

The economists believe that the economy of US is going through a recession and this could be the most defective downtrend in over two decades. With the acceleration in layoffs, there is going to be probably more decline on the value of homes. Freddie Mac has a total number of 28,000 properties facing foreclosure in its record book and Fannie Mae, which happens to Freddie Mac’s sister company, has 67,500 foreclosed properties.

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