A leading indicator of existing-home sales published by the National Association of Realtors fell 7% in July, but NAR economists are still predicting that sales will level off in the months ahead.The pending sales index fell from 113.5 in June to 105.6 in July, which is 16% lower than the level recorded in July 2005. The June number was revised downward from 113.9. NAR chief economist David Lereah said a year-to-year comparison of the pending sales index looks favorable. "Based on recent changes from a year ago, the index shows existing-home sales should continue to ease after a stronger-than-expected decline in July, but are likely to flatten in the months ahead," he said. Mr. Lereah stated that psychological rather than economic factors, such as interest rates and jobs, are causing buyers to remain on the sidelines -- waiting for prices to stabilize. "Contributing to this hesitancy is a lot of negative news stories, but in the end we believe that underlying market fundamentals will prevail," he said. The NAR can be found online at http://www.realtor.org.

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