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Slide continues for sales of existing homes

Washington -- Still unable to pick up traction after a year of persistent weakness, sales of existing homes fell to their lowest level in four years during May, slipping by 0.3% to a seasonally adjusted level of 5.99 million units, down from 6.01 million in April.

 

After a third straight monthly slide, sales of the largest sector of the U.S. housing market, accounting for more than two-thirds of all home sales, have now fallen 10.3% from their year-ago level of 6.68 million units in May 2006, the National Association of Realtors (NAR) reported.

 

Lawrence Yun, NAR senior economist, said, "I think psychological factors are currently the biggest drag on the housing market, in addition to a disruption form tighter credit for sub-prime borrowers," he said. "Household formation has slowed dramatically since late 2006, implying that many people are doubling up -- they're adding roommates or moving in with parents."

 

The housing slowdown rolls on despite low mortgage rates and lower housing prices. The national median price for all housing types was $223,700 in May, down 2.1% from a year ago, when the median price was $228,500.

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