The news is out, and it looks good. Turning to the National Association of Realtors for the data, we learn that existing home sales for December were revised downward to 5.22 million. That's the bad news. The good news is that January existing home sales increased 2.7% to a seasonally adjusted annual rate of 5.36% - beating expectations and also beating both the preliminary and revised December figures. According to Lawrence Yun, chief economist for the NAR, "The uptrend in home sales is consistent with improvements in the economy and jobs, which are helping boost consumer confidence. The extremely favorable housing affordability conditions are a big factor, but buyers have been constrained by unnecessarily tight credit. As a result, there are abnormally high levels of all-cash purchases, along with rising investor activity."
What does he mean by "rising investor activity"? Well, first-time buyers represented 29% of January existing home purchases (down from 33% in December and 40% in January 2010), while investors represented 23% of the purchases (up from 20% in December and from 17% in January 2010). All cash sales constituted 32% of the January sales, the highest level since the NAR started tracking that data point in October 2008.