"God Bless the Dream, the Dreamer and the Result." 

Monday, August 25, 2008

Home Sales Climb, but Prices Keep Falling


Existing home sales were better than expected in July, rising 3.1% to an annual rate of 5 million, the Wall Street Journal reports. But inventories continued their steady expansion anyway, driving prices further downward. The median home price for July was $212,400, down 7.1% from July 2007. The downward price trend is in turn keeping buyers on the sidelines, waiting for better deals.

“Inventories continue to remain high, which means we are in a buyers' market,” says one economist. “Builders need to continue to cut production.” Lenders are also continuing to tighten their mortgage standards, driving more buyers out of the market. Roughly 75% of lenders told the Fed they’d tightened up, compared with 60% in May.

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