Americans purchased more homes in August, but the sales were driven by foreclosures and experts believe that home prices could fall ever further next year.
On Wednesday, The National Association of Realtors announced that homes sales rose 7.7 percent in August. In all that equates to a seasonally adjusted rate of 5.03 million homes annually.
Homes that were at risk of foreclosure comprised 31 percent of the sales, which is a 29 percent increase from July.
Investors, who want to take advantage of the low prices, made up 22 percent of all sales.
The inordinate numbers of homes in foreclosure have made re-sold homes significantly cheaper than new homes. A new home has a median price that is 30 percent higher than previously owned homes.
Homeowners who wish to keep their homes can see a foreclosure attorney to avoid a seizure by the banks.
The number of new home buyers, who are crucial in helping the housing market recover, made up 32 percent of sales. In a healthy market, new homeowners make up 50 percent of all home sales.
Economists have projected that home prices will fall an additional 5 percent by the end of the year. Some homeowners, who have seen dramatic decreases in the value of their homes, retain foreclosure lawyers in order to modify their existing mortgage loans.
What may seem a positive sign actually signals that the housing market is far from recovery. More homeowners will face default and turn to foreclosure attorneys for assistance.
