Resales Slip in August

Sales of existing single-family homes fell 2.7% in August as higher mortgage rates earlier this summer took some stream out of the housing market.The National Association of Realtors reported that existing-home sales fell from a seasonally adjusted annual rate of 6.72 million in July to a 6.54 million rate in August. Despite two consecutive monthly declines, NAR chief economist David Lereah told reporters that housing sales are still 7% above last year's pace and that the August number reflects a more sustainable rate of sales in the longer term. He noted that the August sales decline reflected 6.2% mortgage commitment rates in May and June. However, rates dropped below 6% in August. "We could be getting another jump in home sales" in September and October because of lower rates, Mr. Lereah said. The August report also shows that there is a lean 4.6-month supply of unsold homes on the market. House prices rose 7.3% on an annual basis. The NAR can be found on the Internet at http://realtor.org.