by Calculated Risk on 1/25/2006 10:27:00 AM

The AP reports: Existing Home Sales Set Record but Cooling

Sales of existing homes set a record for a fifth straight year in 2005 even though the year ended on a weaker note with three straight monthly declines, sending a strong signal that the nation's housing boom is beginning to cool.

The National Association of Realtors reported that sales of previously owned homes and condominiums dropped by 5.7 percent in December compared to the sales pace in November. It marked the third consecutive monthly decline, something that has not occurred in more than three years.

From the NAR:

Existing home sales fell to a 6.6 million annual rate in December, 3% lower than December 2004.

Inventories fell to 2.796 million units, from 2.924 units in November, as sellers took their houses off the market for the holidays. However, inventories are up 26.3% compared to December 2004. This represents of 5.1 months of supply at the current sales rate.

The average and median prices fell to levels not seen since May 2005. Average prices were up 7.4% for the year, and median prices up 10.5%.