New Home SalesCENSUS
323K
U.S. Housing Market · 2010
U.S. Housing Market in 2010
Existing SalesNAR
4.19M
Median PriceNAR
$173,100
30Y MortgagePMMS
4.69%
In 2010, the U.S. housing market recorded existing-home sales averaged 4.19 million, new-construction sales of 323K, and a 30-year fixed mortgage rate of 4.69%.
Existing-home sales fell 3.5% from 2009. the median existing-home price rose 0.3% to $173,100. the 30-year fixed mortgage fell 0.35 percentage points to 4.69%.
By the numbers — 2010: new-home sales 323K, existing-home sales 4.19M, median existing price $173,100, 30-year mortgage rate 4.69%.
Macroeconomic Context
The recession had officially ended in June 2009, but 2010 felt nothing like a recovery to most Americans. GDP grew approximately 2.6 percent — modest by historical post-recession standards — and unemployment remained stubbornly high, averaging 9.6 percent for the year. The term "jobless recovery" entered the popular vocabulary, as corporate profits rebounded but hiring did not follow at the expected pace. Consumer price inflation was contained at roughly 1.6 percent, giving the Federal Reserve room to maintain its near-zero interest rate policy and pursue additional asset purchases.
In November 2010, the Fed launched QE2, a second round of quantitative easing involving $600 billion in Treasury purchases, as policymakers worried that the recovery was losing momentum and that deflation risk had not been fully extinguished. Thirty-year mortgage rates, already held down by QE1's MBS purchases, averaged roughly 4.7 percent for the year — levels that would have seemed impossible just five years earlier.
The housing market remained heavily distorted by the foreclosure crisis. A "shadow inventory" of properties in some stage of default or delinquency — estimated at 4 to 5 million units — overhung the market. Distressed sales accounted for roughly one-third of all existing-home transactions, keeping prices depressed in the hardest-hit markets. The robo-signing scandal broke in the fall, as it emerged that major servicers had processed foreclosure documents without proper review, leading to a 50-state investigation and eventual $25 billion settlement.
The first-time homebuyer tax credit, which had provided meaningful stimulus in 2009 and early 2010, expired in April, and sales volumes dipped noticeably in the subsequent months — a reminder of how dependent near-term housing demand had become on government support.