Housing Market - Have We Reached Bottom?

Last week's report on existing home sales by the National Association of Realtors (NAR), revealing a 2.6 percent decline from May, added to the pile of sobering news about the housing market and the economy. Here at Hitwise, we have found, in the past, that Internet activity around home purchase decisions -- specifically, searches for "homes for sale" -- provides valuable insight into what the future may hold for real estate.

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While year-over-year we see a decline in "homes for sale" searches that match existing home sales reports, the last several weeks appear to show a leveling-off in real estate search activity. While home sales declined, the same NAR report indicated that average home prices have dropped 6.7 percent from the previous year. Search data could be indicating that market forces (buyers coming into the market to take advantage of lowering prices) are keeping near-future home sales from continuing their slide.

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