Sales of existing homes in the United States fell for a fourth straight month in June with all sections of the country showing weakness. The National Association of Realtors reported that sales of existing homes dropped by 3.8 percent in June to a seasonally adjusted annual rate of 5.75 million units, the slowest sales pace in more than four years. The median price of a new home edged up slightly to $230,300 in June, a small 0.1 percent increase from the sales price a year ago. This rise was the first year-over-year price increase in 11 months but analysts cautioned that it was too early to determine whether a downward price trend had ended. The decline in home sales was larger than had been expected and served to underscore the problems in housing, which is currently in the worst slump in 16 years. After a five year sales boom of both new and existing home, sales have fallen since 2006 as mortgage rates and price levels rose. Those problems have been worsened by problems in the subprime mortgage market, which offered loans to buyers unable to afford them. Loan defaults mean more homes are coming onto an already overloaded market. The sales declines were recorded in all parts of the country, with sales down 7.3 percent in the Northeast and 6.8 percent in the West. Sales fell 2.8 percent in the Midwest and 1.7 percent in the South. The supply of unsold homes did drop by 4.2 percent in June to 4.2 million, which analysts said was a hopeful sign that the price declines may soon come to an end. The Realtors are forecasting that sales of existing homes will fall by 5.6 percent this year with prices dropping by 1.4 percent. That would mark the first annual price decline on record.
