May 21, 2012
WASHINGTON (AP) -- Fewer people bought previously occupied homes for the third time in four months.
The National Association of Realtors says home sales fell 3.5 percent last month to a seasonally adjusted annual rate of 4.67 million homes. That's far below the 6 million that economists say must be sold to sustain a healthy housing market.
This year's pace is lagging behind last year's total sales. The 4.91 million sold last year were the weakest sales figures in 13 years.
Falling home prices have kept many people from selling their houses and taking new jobs in growing areas. They have also made people feel less wealthy and that has reduced the consumer spending that drives about 70 percent of the U.S. economy.
The average rate on a 30-year fixed mortgage has fallen to its lowest level on records dating to 1971.
Freddie Mac says the rate for the most popular mortgage has dipped to 4.15 percent from 4.32 percent a week ago. Its previous low of 4.17 percent was reached in November.
The average on the 15-year fixed mortgage has dipped to 3.36 percent, also a record. It's the third straight week of record-low rates for the popular refinancing option.
Mortgage rates typically track the yield on the 10-year Treasury note. Economic fears have drawn investors to the safety of Treasurys, driving down the yield on the 10-year note to barely above 2 percent.
Still, low rates have yet to boost the depressed housing market. Many potential buyers can't afford to borrow.
