The National Association of Realtors reported late last week that although August was the second-worst month for sales in more than a decade, sales of previously occupied homes rose in August by 7.6 percent from July to a seasonally adjusted annual rate of 4.13 million.
Unfortunately, a record number of foreclosures and high unemployment have kept the economy from gaining any strength since the recession ended and as a result have deterred many people from buying homes.
When the government was still offering home-buying tax credits they did give the housing industry a boost this past spring, but it has really struggled since they expired at the end of April.
Coupled together both low prices and low interest rates have not been enough to lift the housing market out of its slump.
Eric Matz, a real estate agent with Coldwell Banker in the San Diego area said that potential buyers are still nervous. "Nobody wants to see their investment go down after they buy it. It's as tough as I've ever seen it."
In an effort to try to compete with all the unsold properties, homebuilders who normally power economic recoveries have kept construction rather low. As it is there are nearly 4 million homes on the market and it would take about a year to exhaust that supply at the current sales pace.
According to RealtyTrac Inc, about 2.5 million homes have been lost to foreclosure since the recession started in December 2007. Also, according to Moody's Analytics, another 3.3 million homes may be lost to foreclosure or through a distressed sale over the next four years.
Sales grew last month across the country with the West posting a nearly 14 percent gain from July, while the Northeast had an 8 percent gain followed by the Midwest and the South by a 5 percent gain.