Severe cold weather and a shortage of houses on the market pushed U.S. home
resales to an 18-month low in January, the latest indication economic activity
has hit a soft patch.
The National Association of Realtors said on Friday that home sales dropped
5.1 percent last month to an annual rate of 4.62 million units, the lowest level
since July 2012.
The Realtors group said unseasonably cold weather was partly to blame, but it
also acknowledged some fundamental weakness, with fewer homes on the market to
choose from and higher mortgage rates and prices reducing
affordability.
"Some housing activity will be delayed until spring," said Lawrence Yun, NAR
chief economist. "At the same time, we cannot ignore the ongoing headwinds of
tight credit, limited inventory, higher prices and higher mortgage interest
rates."
The 30-year fixed mortgage rate is about a full percentage point higher than
it was a year ago, even though rates have come down a bit since hitting a
two-year high in September.
Sales tumbled in the Northeast, South and Midwest, which were hit by snow
storms and ice last month. But they were down 7.3 percent in the West, an
indication that other factors apart from the weather also weighed on
sales.
Home resales, which peaked in July, have declined in five of the last six
months, and in January were down 5.1 percent from a year-ago.
http://www.reuters.com/article/2014/02/21/us-usa-economy-housing-idUSBREA1K16J20140221
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