Sales of previously occupied homes fell in July to an annual rate of 3.83 million, the National Association of Realtors said Tuesday.
Previously built single family homes plunged to an all time low according to reports released in July. Steven Ricchiuto, chief economist for Mizuho Securities in New York, said the drop was “so outside the statistically norm” that it was astonishing to even cynical economists.
Existing single-family homes, condominiums and townhouses fell to a seasonally adjusted annual rate of 3.83 million in sales according to the National Association of Realtors. There was an expectation that sales would taper off after April 30. Many would-be buyers took advantage of the beneficial new homebuyer’s tax credit that expired on April 30. Economists, especially those of the Obama Administration, were relying on the credit to boost market sales.
Scott Brown, chief economist at Raymond James & Associates, said the news shows “this is a pretty dicey time” for the U.S. economy. Homeowners planning to sell are now circling the market waiting to see if sales are going to rise. Potential buyers are also in a holding pattern waiting to see if prices will drop lower before they make a purchase.
Las Vegas and Chicago are among two major cities feeling the ripple effects of a sales drop. Economists say sellers in these areas can expect to wait more than five months for their homes to be put back on the market. However, in some cities like Denver and San Francisco the average wait is around two months.