Existing-Home Sales Up, Prices Down

Analysts Split on What Numbers Say About State of Market

Sales of previously owned homes rose in January to the highest level in seven months, according to an industry report released yesterday. But the median home price continued to decline, suggesting that the market is not yet rebounding.

According to the National Association of Realtors, existing home sales nationwide last month were up 3 percent from December 2006 but down 4.3 percent from January a year ago. The figures are seasonally adjusted.

The median price of an existing home fell 3.1 percent last month, to $210,600 from $217,400 in January 2006 . The median is the point at which half the sales prices are higher and half are lower.

"It's a good-news, bad-news story," said David Lereah, chief economist for the Realtors association. "The bad news is prices are down, but the good news is it brought buyers back."

Lereah said unseasonably warm weather might have boosted home sales in January and that recent snowstorms could affect this month's numbers. Still, he said, the past four months have been encouraging. "The worst may be over," he said.

Other analysts disagreed. "I think the housing correction remains in full swing in that we'll see further declines in housing prices for the rest of this year," said Mark Zandi, chief economist at Moody's Economy.com.

The report also said that the number of existing homes available for sale rose 2.9 percent, to 3.55 million. If no more homes were added to the inventory, it would take 6.6 months to sell all of them at the current rate.

The biggest boost in home sales occurred in the West, with an increase of 5.6 percent. Sales in the South, which includes the Washington region, rose 2 percent.