Originally published February 23 2006
Home resale levels fall
by Mike Adams, the Health Ranger, NaturalNews Editor
According to the National Association of Realtors, sales on previously-owned U.S. home dropped 5.7 percent between November 2005 and December 2005, marking the lowest home resale level since March 2004 and perhaps signaling the end of a five-year housing boom.
Sales of previously owned U.S. homes fell more than forecast last month to the lowest level since March 2004, evidence of the end of a five-year housing boom that will slow the economy.
Purchases declined 5.7 percent to a 6.6 million annual rate from November's 7 million, the National Association of Realtors said today in Washington.
Sales, which have been slowing from the record monthly pace reached in June, still finished 2005 at an all-time high of 7.072 million.
While economists forecast a gradual decline in sales, December's slump raises the risk the slowdown could accelerate and become an even bigger drag on the economy this year.
The drop puts Federal Reserve policy makers on notice that more interest rate increases may not be necessary, according to Christopher Low.
A rise in the supply of homes relative to sales, less home price appreciation and higher mortgage rates may also limit refinancing, which has been helping drive spending and economic growth, economists said.
The median price rose 10.5 percent in December from a year earlier to $211,000, the smallest year-over-year increase since a 10.3 percent increase in March.
``Affordability will keep prices in check, but for as long as rates stay near historic lows and employment remains strong, I think pricing will stay strong,'' Bob Walters, chief economist at Livonia, Michigan-based Quicken Loans Inc., said before the report.
The supply of homes for sale, another measure of housing demand, fell to 2.796 million in December from 2.924 million the month before.
Housing affordability fell for a second straight month in November, according to a report earlier this month from the Realtors association.
U.S. economic growth will slow this year as consumer spending and housing demand ebb, according to a Bloomberg survey of economists taken Dec. 23 to Jan. 9.
All content posted on this site is commentary or opinion and is protected under Free Speech. Truth Publishing LLC takes sole responsibility for all content. Truth Publishing sells no hard products and earns no money from the recommendation of products. NaturalNews.com is presented for educational and commentary purposes only and should not be construed as professional advice from any licensed practitioner. Truth Publishing assumes no responsibility for the use or misuse of this material. For the full terms of usage of this material, visit www.NaturalNews.com/terms.shtml