U.S. existing-home sales fell for the eighth consecutive month in October, with median home prices falling by a record amount, according to a report released Wednesday. Sales of existing homes fell 1.2 percent to a record low 4.97 million-unit annual pace, the National Association of Realtors (NAR) said in a report that showed that the downturn in the U.S. housing market was deepening. Home prices fell at a record pace, and the inventory of homes for sale increased as the housing market felt the effects of tighter credit. The median existing-home price fell 5.1 percent from a year ago, and the total housing inventory rose 1.9 percent to October to 4.45 million homes for sale, a 10.8 month supply at the current sales pace. The sales pace was the lowest since NAR began tracking both single-family and condominium sales jointly in 1999. NAR chief economist Lawrence Yun blamed the poor home-selling market on tight credit and falling sub-prime loans that were offered to borrowers with poor credit history. “The sub-prime market has essentially disappeared,” he said. Yun said he believed the drop in sales, which left activity in October 20.7 percent below the level a year ago, was nearing its end. He said a greater willingness of lenders to again start offering “jumbo” loans-higher than $417,000-and the use of Federal Housing Administration-insured loans in place of sub-prime mortgages will help generate a rebound.
