US June existing home sales fall 3.8

WASHINGTON (Thomson Financial) - Existing home sales in the US fell even faster than expected in June, although median existing home prices rose from the prior year for the first time in nearly a year, according to the National Association of Realtors.

Existing home sales fell 3.8 pct in June to a 5.75 mln unit annual pace, much lower than the expected pace of 5.85 mln units. That puts June existing home sales at the lowest pace since November 2002, when the annual pace was 5.73 mln units.

The Realtors revised May existing home sales to a 5.98 mln unit pace.

Despite the continuing drop in existing home sales, the median existing home price in June increased 0.3 pct from June 2006 to 230,100 usd. This is the first year-over-year increase in median existing home prices in 11 months.

NAR senior economist Lawrence Yun said this could be a sign the falling inventories are allowing prices to rebound, although he cautioned that the June figures are just a single month's worth of data that should be viewed cautiously.

June inventories of existing home sales fell 4.2 pct from May to an 8.8 month supply. This is the same as the revised May supply of existing homes, which was the highest level since early 1992.
Yun said the overall decrease in existing home sales is likely caused by rising mortgage rates. 'Mortgage interest rates have risen recently, and tightening lending standards are continuing to hamper sales, but fewer risky loans will put the market on a healthier path,' he said.