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Health eludes ailing US housing market
Source: Agencies |
November 22, 2011, Tuesday
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THE number of Americans who bought previously occupied homes rose slightly last month but remained at depressed levels, while more deals are being canceled at the last minute, a sign that even those looking to buy are worried about the housing market.
Home sales rose 1.4 percent last month to a seasonally adjusted annual rate of 4.97 million, the National Association of Realtors said yesterday, below the 6 million economists say is consistent with a healthy housing market and only slightly ahead of last year's sales - the worst in 13 years.
Sales are counted when buyers close, but many deals are falling apart before that point. A third of realtors said they have had at least one contract scuttled in October, up from 18 percent in September.
More than two years after the recession officially ended, many people cannot qualify for loans or meet higher downpayment requirements. Even those with excellent credit and stable jobs are holding off because they fear home prices will keep falling. Sales are also being hurt by a steep decline in the number of first-time buyers.
Sales have fallen in four of the five years since the housing boom ended in 2006. Declining prices and record-low mortgage rates have not been enough to boost sales.
Most economists say home prices will keep falling, by at least 5 percent, through the rest of the year. Many forecasts anticipate no rebound in prices until at least 2013.
The high rate of foreclosures has made resold homes much cheaper than new homes. The median price of a new home is roughly 30 percent higher than that of one previously occupied - twice the normal difference.
The market continues to struggle despute the broader economy showing some improvement in recent months.
Home sales rose 1.4 percent last month to a seasonally adjusted annual rate of 4.97 million, the National Association of Realtors said yesterday, below the 6 million economists say is consistent with a healthy housing market and only slightly ahead of last year's sales - the worst in 13 years.
Sales are counted when buyers close, but many deals are falling apart before that point. A third of realtors said they have had at least one contract scuttled in October, up from 18 percent in September.
More than two years after the recession officially ended, many people cannot qualify for loans or meet higher downpayment requirements. Even those with excellent credit and stable jobs are holding off because they fear home prices will keep falling. Sales are also being hurt by a steep decline in the number of first-time buyers.
Sales have fallen in four of the five years since the housing boom ended in 2006. Declining prices and record-low mortgage rates have not been enough to boost sales.
Most economists say home prices will keep falling, by at least 5 percent, through the rest of the year. Many forecasts anticipate no rebound in prices until at least 2013.
The high rate of foreclosures has made resold homes much cheaper than new homes. The median price of a new home is roughly 30 percent higher than that of one previously occupied - twice the normal difference.
The market continues to struggle despute the broader economy showing some improvement in recent months.
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