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January housing sales strengthen

A sale pending sign stands in front of a home in Larkspur, Calif., on Thursday. The National Association of Realtors said the 1.74 million previously owned homes for sale at the end of January represented the lowest supply since April 2008.

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A sale pending sign stands in front of a home in Larkspur, Calif., on Thursday. The National Association of Realtors said the 1.74 million previously owned homes for sale at the end of January represented the lowest supply since April 2008.

WASHINGTON — U.S. sales of previously occupied homes rose in January to the second-highest level in three years, a sign that the housing market is sustaining its recovery and helping bolster the economy.

The National Association of Realtors said Thursday that sales rose 0.4 percent in January compared with December to a seasonally adjusted annual rate of 4.92 million. That was the second-highest sales pace since November 2009, when a temporary home buyer tax credit had boosted sales.

The median price for a home sold in January was $173,600, a 12.3 percent increase from a year ago.

Analysts say purchases would be higher if more homes were available. The supply of homes for sale dropped to nearly an eight-year low in January.

The 1.74 million previously owned homes for sale at the end of January represented a 4.2-month supply at January's sales pace. That's the lowest supply since April 2008.

Lawrence Yun, chief economist for the Realtors group, said sellers normally begin listing homes in February in advance of the spring buying season. But he said this increase might not be enough to alleviate the tight supply.

The inventory of homes for sale is 25.3 percent below the level a year ago, when there was a 6.2-month supply of unsold homes.

For all of 2012, sales rose to 4.66 million, according to revised estimates. That was 9.4 percent more than in 2011 and the most since 2007. But even with the gain, sales were below the 5.5 million that economists associate with a healthy market.

Analysts foresee further gains this year. Steady hiring and near-record-low mortgage rates have helped boost sales and prices in most markets. Still, sales are being held back by the low supply.

First-time buyers, who are critical to a housing recovery, made up only 30 percent of sales in January, unchanged from December. That's well below the 40 percent typical in a healthy market.

Sales rose in January in all parts of the country except the West, the region that is being hampered the most by the shortage of homes for sale. In the West, sales fell 5.7 percent. Sales rose 4.8 percent in the Northeast, 3.6 percent in the Midwest and 1 percent in the South.

Other data

Here is a summary of other key economic reports released Thursday:

• U.S. consumer prices were flat in January from December for the second straight month, the latest sign inflation is in check. The consumer price index has risen 1.6 percent in the 12 months ending in January, the Labor Department said Thursday. That's down from a 2.9 percent pace a year ago.

• The number of Americans seeking unemployment benefits jumped 20,000 last week to a seasonally adjusted 362,000, though it remains at a level that suggests slow but steady improvement in the job market. The Labor Department said Thursday that the four-week average, a less volatile measure, rose 8,000 to 360,750, the highest in six weeks.

• A measure of the U.S. economy's future direction edged up in January from December, suggesting slow growth will continue in the coming months. The Conference Board says its index of leading indicators rose 0.2 percent in January to 94.1, the second straight increase after a gain of 0.5 percent in December. The gauge is designed to anticipate economic conditions three to six months out.

January housing sales strengthen 02/21/13 [Last modified: Thursday, February 21, 2013 8:53pm]
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