Sales of existing homes dropped to their lowest level in almost a year as rising mortgage rates and months of double digit price increases have reduced home affordability.
The National Association of Home Realtors reported that sales of previously occupied homes fell to 4.90 million annualized units in November from 5.12 million the previous month. It was the third monthly fall in a row.
Post-recession sales peaked at 5.39 million in July and August and are now 9 percent below. Economists in the Reuters survey had forecast a 5.03 million unit pace.
Rates for 30 year mortgages have risen more than 1 percent since early May and were 4.46 percent yesterday according to bankrate.com.
Home prices have been on a steady upward curve since the middle of last year. In September the yearly Case-Shiller 20 city price index reached 13.29 percent, the seventh straight month of annual double digit price increases and the biggest yearly gain in more than seven and a half years, since February 2006.
Home prices within the existing home sales data have begun to moderate. In November the median price of a single family residence in the U.S. was $196,300 down from $197,500 in October and $214,000 in June. The annual price increase in November dropped to 9.4 percent the first time since last December it has been less than 10 percent. The all-time high median price was $230,300 in July 2006.
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