Sales of existing homes fell 12.8% in August compared to the same month in 2006, to a seasonally adjusted annualized rate of 5.5 million units, according to the most recent figures from the National Association of Realtors. Existing single family home sales dropped 13.0% from August 2006 to a seasonally adjusted annualized rate of 4.81 million homes.
Total housing inventory rose 0.4% at the end of August to 4.58 million existing homes available for sale, which represents a 10.0-month supply at the current sales pace. That number will grow over the next few months, as foreclosures grow and consumers with adjustable rate mortgages that reset to higher payments than they can afford will sell their homes.
“The unusual disruptions in the mortgage market, including a significant rise in jumbo loan rates, resulted in a fairly high number of postponed or cancelled sales, with many buyers having to search for other financing when loan commitments fell through,” Lawrence Yun, NAR senior economist said. “Lower sales contributed to a buildup of unsold inventory.” Yun expects similar results for home sales in September.