Lereah on February Existing Home Sales Report

The realtors said the supply of unsold homes also rose 5.2% in February to 3.03 million, close to the all-time record of 3.04 million set in 1986. The inventory represents 5.3 months supply, unchanged from January.

"This is a good soft-landing scenario," said David Lereah, chief economist for the real estate group. Price appreciation has slowed. Median prices are now up 10.6% year-over-year to $209,000.

"This is a tale of two cities," Lereah said. Sales have fallen by double-digit percentages in some of last year's hottest markets, such as Phoenix, Fort Lauderdale and San Diego, he said. But some of the most affordable markets are now heating up, he said, pointing to Indianapolis, Albuquerque and Houston.

"Fundamentals are still good," Lereah said. [ Marketwatch 03/23/06]