Existing Home Sales Down 1% in April

With the backlog of unsold homes rising to the highest level in two decades, existing home sales fell 1% in April to 4.89 million units, the National Association of Realtors reported. It was the eighth decline in the last nine months. In addition, The NAR said the median price for an existing home dropped 8%, compared with a year ago, to $202,300. Many analysts expect further home price declines given the huge number of unsold single-family homes, which rose in April to 10.7 months supply at the current sales pace, the highest inventory level since June 1985. Sales were down 6% in the Midwest and fell 4.4% in the Northeast. Sales grew 6.4% in the West and were unchanged in the South.

But, providing some optimism, Lawrence Yun, chief economist for the NAR, said there may be improvement in existing home sales in the second half of this year as more types of mortgages become available as industry and the government respond to the credit crunch that started last August. However, other economists are not as optimistic, saying potential buyers are waiting for home prices to fall further before acting.

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Date Last Updated: 06/02/2008