WASHINGTON (AP) -- Signaling a housing recovery is under way in much of the country, sales of previously occupied homes rose for the third month in a row in June.
The National Association of Realtors said Thursday that home sales rose 3.6 percent to a seasonally adjusted annual rate of 4.89 million last month, from a downwardly revised pace of 4.72 million in May. Home sales haven't risen for three straight months since early 2004, during the housing boom.
"The housing market is healing," said Lawrence Yun, the group's chief economist.
Prices, however, are expected to keep falling well into next year because of a backlog of foreclosures that have yet to come on to the market. The median sales price was $181,800 in June, down 15 percent from year-ago levels but up slightly from $174,700 in May.
It was the highest level of sales since last October and beat economists' expectations. Sales had been expected to rise to an annual pace of 4.84 million units, according to Thomson Reuters.
The inventory of unsold homes on the market fell to 3.8 million. That's a 9.4-month supply at the current sales pace and another important sign of a recovery. When the inventory level falls to about 7 months, prices should begin to stabilize, Yun said.
Sales of foreclosures and other distressed properties made up about a third of all transactions last month, down from nearly half earlier this year.