Home Sales Plunge to 4-Year Low

Inventory glut, rising mortgage rates bode ill for quick rebound
By Caroline Zimmerman,  Newser User
Posted Jun 25, 2007 6:27 PM CDT
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(Newser) – Sales of existing homes fell again last month, while the number of homes languishing on the market hit a 15-year high. The median price sank to $223,700, the AP reports, and thanks in part to the woes of the subprime mortgage sector, overall sales were 10.3% below last year's numbers. Says one analyst: "Don't look for a bottom anytime soon."

The numbers came as a relief to Wall Street, where there had been fears of an even sharper decline. Experts say the only way to reduce inventory of existing homes, which make up about 85% of the market, is for sellers to embrace price cuts—which hasn't happened so far.