Friday, September 28, 2007

NAR Reports August Existing-Home Sales Fall Due To Temporary Mortgage Problems

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In a press release for the National Association of Realtors entitled, "August Existing-Home Sales Fall on Temporary Mortgage Problems," Walt Molony cited news that existing home sales has fallen due to the problem of mortgage unavailability in the market. This problem was described as "peaking," which attests to this issue being far from over. Or is it?

"Total existing-home sales – including single-family, townhomes, condominiums and co-ops – were down 4.3 percent to a seasonally adjusted annual rate1 of 5.50 million units in August from a level of 5.75 million in July, and are 12.8 percent below the 6.31 million-unit pace in August 2006" (Molony).

According to Molony, Lawrence Yun, a Senior Economist at the National Association of Realtors, said he had expected the decline that resulted from a rise in cancelled and postponed sales transactions; which occurred when loan commitments fell through. This trend is expected to continue through September. However, Molony cited a different perspective from NAR President, Pat V. Combs, when she said that the outlook is actually improving:

"'Mortgage interest rates have been declining and loan availability is improving,' she said. 'Movements to enhance the FHA loan program and to raise the limits for conventional financing could provide additional relief, and it looks like the worse of the mortgage availability problem is behind us...The abundant choice of homes is permitting buyers to better negotiate price and terms. There are good opportunities in the market now, especially for first-time buyers'" (Malony, Combs).

Read full press release: "August Existing-Home Sales Fall on Temporary Mortgage Problems"

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