Existing home sales fell fractionally in February from the previous month but the housing and mortgage industries received a new dose of bad news Tuesday morning with total inventories rising 9.5% during the month to 3.59 million units.
Also, some housing analysts now expect a compressed spring home buying season because of expiring federal tax credits benefiting first-time homebuyers and certain move-up customers. Another bad omen for the market, according to analyst Eric Landry of Morningstar, is an increase in listings by non-distressed sellers.
The National Association of Realtors (NAR) reported that existing homes sales slipped 0.6% in February on a seasonally adjusted basis to 5.02 million units. Compared to February of last year, home sales rose 7%. The figures represent detached single-family units as well as townhomes, condominiums, and cooperatives. NAR is blaming the poor numbers, in part, on bad weather in the Northeast and mid-Atlantic.
"Some closings were simply postponed by winter storms, but buyers couldn't get out to look at homes in some areas and that should negatively impact near-term contract activity," said NAR economist Larry Yun.
He added that, "Although sales have been higher than year-ago levels for eight straight months and home prices are much more stable compared to the past few years, the housing recovery is fragile at the moment."