US existing-home sales pick up in October

Sales of previously owned homes in the United States rose slightly in October after falling the prior month as the depressed housing market struggles to gain traction, an industry report said Monday. Sales of so-called "existing" homes increased 1.4 percent to a seasonally adjusted rate of 4.97 million units, the National Association of Realtors said. But the NAR reported September's decline in sales was less than first estimated, revising the annual rate to 4.90 million units from 4.91 million units. Lawrence Yun, NAR chief economist, said the market for existing single-family homes, condos and townhouses continued to underperform. "Home sales have been stuck in a narrow range despite several improving factors that generally lead to higher home sales such as job creation, rising rents and high affordability conditions," Yun said. On a 12-month basis, existing-home sales were 13.5 percent higher than in October 2010. More than five years after the housing price bubble began to collapse and despite government measures to rescue the embattled sector, homebuyers are facing huge hurdles in getting financing approved, NAR said. "A higher rate of contract failures has held back a sales recovery," Yun said, noting contract failures jumped to 33 percent in October from 18 percent in September. The October rise in existing-home sales came as the number of homes on the market continued to decline, a positive sign suggesting stabilization in the housing market Total existing homes for sale at the end of October fell 2.2 percent to 3.33 million, an 8.0-month supply at the current sales pace, down from an 8.3-month supply in September. Inventories have been trending lower since setting a record of 4.58 million units in July 2008. The national media existing-home price for all housing types was $162,500 in October, 4.7 percent lower than in October 2010.