May 25 2007
Housing Continues to Vent
U.S. Existing Home Sales Drop to Lowest in Four Years [Bloomberg]
Sales of previously owned homes in the U.S. unexpectedly fell in April to the lowest level in almost four years, dimming prospects for a quick recovery in the housing industry.
Purchases fell 2.6 percent to an annual rate of 5.99 million last month from 6.15 million in March, the National Association of Realtors said today in Washington. A measure of the supply of homes for sale rose to the highest since August 1992.
The decline comes a day after a government report showed sales of new homes surged as buyers took advantage of a slide in prices. Today’s figures suggest that owners of existing homes may have to cut prices further during the prime spring selling season. The drop also reflects the impact of banks making it tougher to get subprime loans, a response to rising defaults.
Big drop in home prices predicted: Some economists see steeper drop in store for home prices. [CNN Money]
Most industry watchers agree that home prices will continue to slide before they recover, but now some economists say they’ve got a long way to fall before bouncing back.
David Wyss, chief economist at Standard & Poors, has forecast a price drop of about 8 percent for the 24-month period through the fourth quarter of 2008. Housing prices will suffer from a “significant increase in defaults and foreclosures,” he said, with affordability still a major issue. Wyss worried how hard the slump will hit already highly inflated housing markets.
Sales of Existing Homes Fall to Slowest Pace in Nearly 4 Years
The National Association of Realtors reported Friday that sales of existing homes dropped by 2.6 percent last month to a seasonally adjusted annual rate of 5.99 million units, the slowest sales pace in nearly four years.
Mortgage industry reloads as subprime misery lingers
Angelo Mozilo, the butcher’s son who built Countrywide Financial Corp. into the largest mortgage lender in the United States, was in no mood for soul-searching over the subprime home crisis.
