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June 27, 2006
More Evidence of Real Estate Decline
WASHINGTON (MarketWatch) -- Resales of U.S. homes fell 1.2% to a seasonally adjusted annual rate of 6.67 million in May, the National Association of Realtors said Tuesday. Sales of existing homes have fallen in three of the past five months.
"The inventory of unsold homes increased 5.5% to 3.60 million. The 6.5-month supply is the highest in nine years. The inventory was at 4.3 months a year ago. "The housing sector is continuing to cool, applying a damper on economic growth," said Arlene Kish, an economist for BMO Nesbitt Burns. "The persistent rise in the backlog of unsold homes is a clear warning sign for the sector." "The housing correction is far, far from over," said Ian Shepherdson, chief U.S. economist for High Frequency Economics. "The pending sales index points to existing home sales dropping to about 6.3 million over the next few months."
Sales of existing homes in April were revised lower to 6.75 million from 6.76 million.
Posted by Post Scripts at June 27, 2006 01:49 PM