"Housing Continues to Boom as 2003 Resales Shatter Record"

Sales of previously owned homes set a record high in 2003 as decades-low mortgage rates proved too good for many buyers to pass up.

The National Association of Realtors reported Monday that existing home sales totaled 6.1 million last year, shattering the previous record of 5.57 million set in 2002. Last year's sales represented a 9.6 percent increase from 2002's level.

Monday's report provided vivid evidence of the red-hot strength of the housing market, which played a main role in keeping the economy going throughout last year. In December, existing-home sales jumped by 6.9 percent from the month before, ending the year on a high note.

"Housing continues to boom," said David Lereah, chief economist at the National Association of Realtors.

Records also were set both statewide and in metro Orlando last year. The Florida Association of Realtors said 203,243 were sold in 2003, up more than 13 percent from 2002's 179,631 sales.

The median price of existing homes sold around the state last year was $158,400, up from $141,700 in 2002. Since 1998, the statewide median has increased by nearly 56 percent.

In metro Orlando, more than 30,000 home transactions were recorded during 2003, up from 26,613 recorded in 2002. Low mortgage rates have powered the housing market. The average rate on a 30-year, fixed-rate mortgage for all of 2003 was 5.83 percent, the lowest annual average since Freddie Mac began tracking interest rates in 1971.

Lereah predicts that existing-home sales will slow a bit this year, clocking in around 5.80 million, which would still represent a healthy pace. A slowdown in sales is based in part of the expectations that mortgage rates will drift higher later this year as the economy continues to gain momentum.

The Mortgage Bankers Association projects that 30-year mortgages would end 2004 in the range of around 6.3 percent. That rate would still be attractive to prospective homeowners and would support housing sales, economists said.