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Existing-Home Sales Fall to Record Low

Mortgage News > Existing-Home Sales Fall to Record Low
Date: 10/26/2007    Existing-Home Sales Fall to Record Low

Sales of existing U.S. homes sank to the lowest pace on record during September, according to the latest data released Wednesday from the National Association of Realtors.

 "Mortgage problems were peaking back in August when many of the September closings were being negotiated, and that slowed sales notably in higher priced areas that rely more on jumbo loans," said NAR senior economist Lawrence Yun in a statement.

He added, "Sales were dampened by the mortgage cancellations."

Existing-home sales fell 8 percent to an annual rate of 5.04 million last month, down from a revised 5.48 million in August. That represents the lowest monthly figures since the NAR began tracking sales in 1999.

The current pace is 19.1 percent behind the 6.23 million-unit pace of September 2006.

Regionally, the Northeast saw the largest decrease in existing sales, with a 10.0 percent drop to an annual rate of 900,000. Sales in the West experienced a similar decline, with the annual pace falling 9.9 percent to 910,000. The Midwest existing-home sales sank 7.0 percent to 1.19 million, while sales in the South fell 6.0 percent to an annual pace of  2.05 million.

Still Yun saw a silver lining in the report.

"The good news is that mortgage availability has markedly improved in recent weeks with interest rates on jumbo loans falling, and more people are applying for safer and conforming FHA mortgage products.  Some of the cancelled transactions will move forward as buyers apply for other loans."