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Tuesday, Jul. 28, 1998
June home sales flag, but remain strong
Bullish stock market, low interest rates driven by Asian economic turmoil give sales a boost
By DAVE SKIDMORE
Associated PressWASHINGTON - Sales of existing single-family homes slipped a bit in June from a record high the month before but remained at what an analyst called a spectacular level.
The 2.3 percent decrease brought the seasonally adjusted annual sales rate to 4.72 million, down from 4.83 million, the National Association of Realtors said Monday. May sales were the highest since the group began tracking sales in 1968.
Sales increased slightly in the Midwest and South and dropped more steeply in the West and Northeast. That added up to a somewhat larger decline nationally than analysts had forecast, but they were not concerned.
(Corpus Christi realtors sold 922 existing homes in the second quarter, compared with 864 in the second quarter of 1997, according to the Corpus Christi Board of Realtors Multiple Listing Service, which includes Nueces and San Patricio counties. June sales of 299 existing homes were slightly above May's total of 292. The median sale price for the second quarter rose 2.68 percent from $78,400 in 1997 to $80,500 in 1998, according to the Board of Realtors.)
``We have all gotten so spoiled by seeing new records month after month in home resales that we should remember any reading above a 4.5 million annual level is spectacular,'' said economist David Orr of First Union Corp. in Charlotte, N.C.
Though spillover from Asia's economic crisis is abruptly slowing U.S. economic growth, economists expect home sales to retain much of their vigor. In fact, low U.S. interest rates - a side effect of the Asian turmoil - is helping to keep home sales strong by keeping monthly mortgage payments affordable.
Rates for fixed-rate, 30-year loans averaged 7 percent in June, according to Freddie Mac, the mortgage company. Except for 1993, when the average briefly dipped to around 6.75 percent, rates haven't been lower since the late 1960s.
Also, with the nation's unemployment rate near a 28-year low in June and stock market gains in double digits in recent years, Americans increasingly have the money for down payments.
``Given favorable interest rates and income trends, we expect home sales to remain strong in the near future, but (they) should not accelerate further,'' said economist Karen Dexter of Merrill Lynch.
Fred Flick, Realtors' vice president for economic research, predicted 1998 sales would total around 4.54 million, 7.7 percent higher than 1997, when a record 4.21 million homes were sold.
Regionally, the West suffered the largest drop in June, down 10.9 percent to an annual rate of 980,000 units. Sales also fell in the Northeast, by 5.6 percent to a rate of 670,000 units.
Sales increased 1.7 percent to a rate of 1.2 million units in the Midwest and 1.6 percent to a rate of 1.87 million units in the South.
Nationwide, the median sales price of an existing home, meaning half sold for more and half for less, was $134,600 in June, up 5.8 percent from a year earlier.
Staff writer Glaston Ford contributed to this report. He can be reached at 886-3678 or by e-mail at fordg@scripps.comPost your comments about local news eventsFront Page || Main Index || News || Business || Texas || South Texas Outdoors || Birdwatching || Sports || Entertainment || Selena || Education || South Texas Attractions || World Wide Web