Existing Home Sales Up 3.3% as Rates Fall

Sales of existing homes rose 3.3% nationwide in July, their second straight increase, as mortgage rates dropped into the single digits, a real estate trade group reported today.

The National Assn. of Realtors said house resales totaled a seasonally adjusted annual rate of 3.44 million units compared to June’s rate of 3.33 million.

The 0.9% gain in sales in June was the first advance in seven months.

In Los Angeles and Orange counties, sales dipped slightly, officials with the California Assn. of Realtors said.

The number of escrows closed on single-family homes was down 3.5 in the Los Angeles area compared to June and down 21.3% from July, 1989.

In Orange County, sales were down 0.1% in July, compared to June, and 18.7% compared to a year ago.

Home prices edged up 0.2% to $215,533 in July in Los Angeles but were off 4.5% compared to the previous year’s record high of $225,616.

The median home price for Orange County was $245,798 in July, down 0.5% from the previous month but up 0.5% from a year ago.

Fixed-rate, 30-year mortgages fell from 10.06% to 9.8% during July, according to surveys conducted by the Federal Home Loan Mortgage Corp. However, they turned upward after the Aug. 2 Iraqi invasion of Kuwait and reached 10.29% by last Friday.

“Home buyers watched rates keep drifting down and started making their move,” Realtors’ President Norman D. Flynn said. “The rate drops brought in some borderline buyers who were priced out of the market earlier this year, as well as buyers who could have bought sooner, but chose to wait out the rate increases.”

Flynn said the recent rate increases probably will push down sales this month.

The national median existing-home price was $98,400 in July, up 0.9% from June. The median price means half of the homes cost more, half less.