WASHINGTON -- Nationwide sales of previously occupied homes rose last month after the worst summer for the housing market in more than a decade. And fears over flawed foreclosure documents could keep buyers on the sidelines in the final months of the year.
In the Tri-Cities home sales are up 20 percent for the year compared to last year at this time, said Paul Roy, of Coldwell Banker Tomlinson in Kennewick and vice president of the Tri-City Association of Realtors.
Because the Tri-Cities was not hit with high numbers of foreclosures as other areas of the country were, questions of flawed foreclosure documents should not affect the market here, he said.
Nationally, sales grew 10 percent in September to a seasonally adjusted annual rate of 4.53 million, the National Association of Realtors said Monday.
Never miss a local story.
Home sales have declined 37.5 percent from their peak annual rate of 7.25 million in September 2005. They have risen from July's rate of 3.84 million, which was the lowest in 15 years. Most experts expect about 5 million homes to be sold through the entire year. That would be in line with last year's totals and just above sales for 2008, the worst since 1997.
Still, sales could fall further if potential lawsuits from former homeowners claiming that banks made errors when seizing their homes make consumers fearful of buying foreclosed properties.
The Federal Reserve on Monday became the latest regulator to announce it would be looking into whether mortgage companies cut corners on their own procedures when seizing homes. Chairman Ben Bernanke said the Fed would look intensively to see if policies, procedures or internal controls led lenders to improperly foreclosure on homeowners. Preliminary results of an in-depth report are expected to be released next month.
"We take violation of proper procedures very seriously," Bernanke said.
In a survey taken by the Realtors group this month, about 23 percent of the 2,000 agents surveyed said they have a client who is no longer interested in purchasing a foreclosed property due to the foreclosure-document mess.
"You're going to see uncertainty on the part of homebuyers," said Quinn Eddins, director of research at Radar Logic Inc., which tracks the housing market.
Mortgage applications to purchase homes last week were 29 percent below the same week a year ago, according to the Mortgage Bankers Association. At that time, buyers were rushing to purchase homes to qualify for federal tax credits.
Last month the inventory of unsold homes on the market fell about 2 percent to 4 million. That's a 10.8 month supply at the current sales pace.