Are Homes Sales Up or Down?

Reading the headlines, you see that existing home sales are down. Then you turn the page and notice that purchase applications are up. Does that make any sense? But both statements are true.

First, looking at the October report of the National Association of Realtors, which reports on October sales, we see that existing home sales dropped 2.2 percent from September and 24.9 percent from a year earlier. Now that 12-month drop might sound really bad, but remember, in October 2009 homebuyers were rushing to make a purchase in time to take advantage of the first homebuyer tax credit. So the October 2009 numbers were much higher than normal.