NAR reports further fall in US home sales in June

| July 22, 2010
NAR reports further fall in US home sales in June

The National Association of Realtors (NAR) has today revealed a further fall in sales of previously owned homes in the US for the month of June – the second consecutive monthly fall.

The industry body said sales fell 5% in June to an annual rate of 5.37 million units.

While the figure is 9.8% higher than a year earlier, it remains way below the 7 million units at the height of the housing boom.

However, analysts had expected a fall last month, due to the end of the Government’s tax credit initiative, which provided up to $8,000 for new buyers and $6,500 for current owners who buy and move into another home.

Commenting on June’s figures, Lawrence Yun, chief economist for the NAR, said: “Broadly speaking, sales closed after the home buyer tax credit will be significantly lower compared to the credit-induced spring surge.”

He added: “Only when jobs are created at a sufficient pace will home sales return to sustainable healthy levels.”

As the effect of the tax credit continues to fade over the next few months, sales are expected to dwindle.

The figures come just a few days after the Commerce Department revealed US housing starts plummeted in June – far more than expected, raising fears for the already fragile housing market.

According to the Commerce Department, construction of new US homes fell 5% in the month to a seasonally adjusted annual rate of 549,000 properties – the lowest since October 2009 and represented the second consecutively monthly fall.

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