Michelle Jamrisko, BLOOMBERG BUSINESS
(Bloomberg Business) – Sales of previously owned U.S. homes fell more than forecast in August as lean inventories slowed this year’s momentum.
Closings, which usually take place a month or two after a contract is signed, declined 4.8 percent to a 5.31 million annual rate from a revised 5.58 million pace that was the strongest since 2007, the National Association of Realtors reported Monday. Prices climbed and the number of homes on the market decreased from the same time a year ago.
Limited availability of homes on the market is making it difficult for some Americans to take advantage of low interest rates and relocate after a recovery in property values. While home sales have improved this year, Federal Reserve Chair Janet Yellen said last week that the pace of improvement has been inconsistent with a firmer labor market and demographics that should provide a bigger boost.
“Inventories are still holding back sales,” said Stuart Hoffman, chief economist at PNC Financial Services Group in Pittsburgh, whose 5.4 million forecast was among the lowest in a Bloomberg survey. “Momentum is there — more jobs, more income, more credit availability and still-stable mortgage rates.”
The Realtors group’s latest 2015 estimate for previously owned home sales is 5.29 million, up 7.1 percent from a year earlier.