Sales of Existing U.S. Homes Fell to Eight-Month Low in June [View all]
Sales of previously owned U.S. homes unexpectedly declined in June to an eight-month low, showing the recovery in residential real estate will take time to develop.
Purchases decreased 5.4 percent to a 4.37 million annual rate last month from a revised 4.62 million in May, figures from the National Association of Realtors showed today in Washington. The median forecast of economists surveyed by Bloomberg News called for a 4.62 million pace.
Slower job growth, stricter lending standards and competition from cheaper distressed properties may be impeding the market even with mortgage rates at all-time lows. The drop in home values since the last recession has also left some homeowners owing more than their property is worth, limiting their ability to relocate.
“Housing demand is going to improve in fits and starts,” said Ryan Sweet, a senior economist at Moody’s Analytics Inc. in West Chester, Pennsylvania. “Given that hiring has slowed down over the last few months, I don’t think it’s surprising we’re seeing sales soften. Buyers are hesitant because they didn’t want to buy a home and see it depreciate within a year.”