Sold! Existing Home Sales Jump in July

Inho Choi never imagined he could live in this neighborhood outside of San Francisco. Now, he's the proud owner of a 4-bedroom, 3,000-square-foot home.

He was able to buy it thanks to falling prices, low interest rates, and a government tax credit of $8,000 as CBS News Correspondent Ben Tracy reports.

"I paid less than half the price that the previous owner paid," Choi said.

The previous owner paid $673,000. Choi paid about half: $338,000.

July Existing Home Sales Details

Bargain basement sales like this are bringing new life to hard hit cities such as Mountain House California. Last year it took 80 days to sell a house. Now it's just 21.

Nationwide, the seven percent jump in home sales marked the fourth straight month sales are up. The last time this many homes sold was August of 2007.

"I wouldn't be standing up and cheering yet. But things are better than they were six months ago. There's no question about that," said Richard Green, director of the USC Lusk Center.

It's good for buyers, but many are selling at a loss.

Nationwide the median single family home price was just $178,000 in July. That's down 14.6 percent from a year ago.

"I think we're gonna stay kind of where we are now, in terms of prices, for the next couple of years," said Green.

That's because experts warn another wave of foreclosures could hit the market. These are tied to people losing their jobs and interest rates rising on risky home loans.

Realtor Tarnasha Brown is just glad to see bidding wars back, even if the once high prices are not.

"I had a home I put on the market Wednesday night 10 pm. By Thursday morning, 15 phone calls. By Sunday ten offers on the property," said Brown.

Many buyers are rushing into the market before the federal tax credit for first time homeowners expires in November.

Choi says that $8,000 helped get him in the market and he isn't worried about losing his investment.

"If it's not the bottom, it is near bottom. And if it goes down it's not going to freefall anymore," Choi said.