US home sales slip another 3.1 per cent

WASHINGTON: Existing US home sales fell 3.1 percent in October as buyers remained on the sidelines amid economic uncertainty, the National Association of Realtors said on Monday.

The industry group said sales of homes and apartments dropped to a seasonally adjusted annual rate of 4.98 million units, below the consensus forecast of private economists of a pace of 5.05 million.

The level is 1.6 percent below that of October 2007 and highlights the ongoing distress in the US real estate market, whose collapse after a years-long boom has triggered widespread economic chaos and massive losses for the financial system.

The market had staged a modest rebound in September but could not sustain the pace amid renewed economic and market turmoil.

"Many potential home buyers appear to have withdrawn from the market due to the stock market collapse and deteriorating economic conditions," said Lawrence Yun, NAR's chief economist.

"We have favorable affordability conditions, but we need more than that to give buyers with jobs the confidence they need. This is why a housing stimulus is so critical now to encourage more buyers to draw down the inventory and stabilize home prices. Without home price stabilization, there will not be an economic recovery."

The inventory of unsold homes at the end of October slipped 0.9 percent to 4.23 million homes, a 10.2-month supply at the current sales pace.