Home Resales Slump in June as Mortgage Rates Spike

Inventories are down; prices jump
By Heather McPherson,  Newser User
Posted Jul 25, 2007 1:57 PM CDT
The National Association of Realtors that existing-home sales fell dramatically while inventories fell and prices rose.   (Index Open)
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(Newser) – Sales of existing homes dropped in June to a 5-year low because of rising mortgage rates and stricter lending standards. Home resales dipped 3.8% from a 5.98 million annual rate in May to a 5.75 million rate now. "The housing recession looks far from over," an economist tells the Wall Street Journal.

Freddie Mac reported a spike in the average 30-year mortgage rate to 6.66% in June, up from 6.26% in May. That's contributing to the dismal housing market, which has stunted economic growth in the US for six consecutive quarters. But on a positive note, points out another economist, inventories of homes fell 4.2% at the end of June to 4.20 million, and median prices rose for the first time in 11 months.