Existing home sales drop 1.2%

Sales of existing homes fell in October pushing supply of homes to the highest level since 1985, according to a report by the National Association of Realtors. Home sales fell 1.2% to a seasonally adjusted pace of 4.97 million home. Home sales are down 20.7% from the 6.27 million unit pace recorded in October 2006. The inventory of unsold homes increased 1.9% to 4.45 million, representing a 10.8 month supply, according to the Washington-based real estate industry trade group. The national median existing home price for all housing fell 5.1% to $207,800 in October, down from a reading of $218,900 in October 2006. Regionally, sales were unchanged in the Northeast and the South, while falling 1.7% in the Midwest and 4.4% in the West. The report was released one day after the Standard & Poor's /Case-Shiller Home Price Indices, a gauge of home prices across the country, recorded that the price of existing U.S. homes fell 4.5% in the third quarter compared to the same period in 2006 (InvestmentNews, Nov. 27).