Boosted by a record decline in prices, the U.S. housing market showed signs of stability in February, with sales of existing home rising modestly for the first time in seven months, the National Association of Realtors reported today.

Resales of U.S. homes and condos rose 2.9% to a seasonally adjusted annualized rate of 5.03 million.

It’s the strongest sales pace since October. Sales are down 23.8% compared with a year ago.

Inventories of unsold homes fell 3% to 4.03 million, representing a 9.6-month supply at the February sales pace. Inventories are not seasonally adjusted, but a decline from January to February is unusual.

The median sales price plunged to US$195,900, down 8.2% from a year earlier, the largest price decline recorded. Prices of single-family homes fell 8.7% in the past year, also the most since the records begin in 1968.

Since the credit crunch first hit in August, resales have been “stuck” in a narrow range around 5 million, said Lawrence Yun, chief economist for the real estate agents’ trade group.

Sales rose in three of four regions, with the West still lagging. Sales rose 11.3% in the Northeast, 2.5% in the Midwest and 2.1% in the South. Sales fell 1.1% in the West.

Median sales prices are down 13.4% in the West, largely because the market for jumbo loans above $417,000 remains frozen, Yun said.