Home prices fell to their lowest point in over 10 years in January, which helped raise the pace of home sales, according to CNNMoney.
The median home price in January went down 2 percent from December $154,700, according to the National Association of Realtors. That's the lowest home price reading since November 2001, before the sharp increase of home prices that became known as the housing bubble.
The median price is the point at which half of homes are sold for a lower price, and half are sold at a higher price, according to CNNMoney.
A big inventory of homes in foreclosure helped bring down prices on existing homes, according to the article. Homes in foreclosure and short-sale homes, in which the home is sold for less than what is owed on the mortgage, also referred to as distressed sales, accounted for 35 percent of sales during the month of January.
Prices will continue to go down throughout the first part of 2012 because of distressed sales, chief economist with PNC Financial Stuart Hoffman told CNNMoney. "The recent agreement between the big mortgage servicers, state attorneys general and the Obama administration will also result in more homes going to foreclosure over the next months, adding to downward pressure on prices."
However, the pace of sales increased to the highest level since May 2010, helped by the extremely low mortgage rates and low prices. The seasonally adjusted annual sales pace of 4.57 million homes rose a little from the revised 4.38 in December, according to CNNMoney. The last time homes sold at that rate was when the $8,000 home buyers' tax credit was about to expire.
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