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Bbc: Us Home Sales Decline Yet Further

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Poor BBC, on Friday it was: http://news.bbc.co.uk/1/hi/business/6961602.stm and now this....

They just cant make up their minds can they!? ;)

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http://news.bbc.co.uk/1/hi/business/6965726.stm

US home sales decline yet further

US homes

The housing market slump has hit US shares

Concern that US house prices could fall sharply has returned after a key survey showed that sales fell to a near five-year low in the year to July.

Sales of existing homes fell 0.2% to 5.75 million units in the year, the lowest since November 2002, said the National Association of Realtors (NAR).

It marks the first time that the US's main estate agent body had reported a decline in 12 consecutive months.

Last week a separate study said sales of new homes rose in July.

That surprise finding gave Wall Street a major boost on Friday, but the latest NAR data from caused key US shares to fall in early trading on Monday.

The Dow Jones index of leading US shares was down 54 points at 13,325, while the Nasdaq lost 11 points to 2,565.

'Downturn intensifying'

NAR added that the supply of unsold single-family homes has now hit its highest level in 16 years.

"This shows that the housing downturn continues to intensify," said Moody's economist Mark Zandi.

"It shows no sign of abating.

"It's a large amount of unsold homes, and it's really weighing on the market."

Concerns over the US housing sector, and the resulting market turmoil of recent weeks, centred on the so-called sub-prime mortgage sector.

This gives higher risk loans to people with poor credit histories.

Sub-prime default levels have risen to record highs over the past year in the face of higher US mortgage rates, raising fears that this could hamper credit availability in the broader market.

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Guest The_Oldie

http://www.bloomberg.com/apps/news?pid=206...&refer=home

Aug. 27 (Bloomberg) -- Sales of previously owned homes fell to a five-year low in July and the glut of unsold properties climbed to the highest since 1991 as the U.S. housing slump dragged on.

With no recovery in sight for housing, lower property values and higher mortgage costs threaten to weaken consumer spending, economists said. The Federal Reserve this month acknowledged a growing risk to economic growth because of the rout in credit markets. Stocks weakened.

Purchases declined 0.2 percent to an annual rate of 5.75 million, the National Association of Realtors said today in Washington. While the retreat was less than forecast, inventories of single-family homes rose to the equivalent of a 9.2 months' supply and sales dropped 9 percent.

``We are very likely to see home sales continue to drop,'' said Ethan Harris, chief economist at Lehman Brothers Holdings Inc. in New York, who accurately predicted the number. ``There's a big imbalance between supply and demand, with lots of people who want to sell and lots of hesitant buyers.''

Sales were projected to fall 0.9 percent to a 5.7 million annual rate, according to the median estimate of 74 economists in a Bloomberg News survey. Predictions ranged from 5.5 million to 6 million. Existing home sales averaged 6.51 million in 2006.

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