Alan Zibel, AP Real Estate Writer
USA Today
WASHINGTON — Sales of previously occupied homes dipped 2.2% in May, suggesting that a boost from government home-buying incentives is winding down earlier than expected.
The National Association of Realtors says last month’s sales fell to a seasonally adjusted annual rate of 5.66 million. April’s results were revised upward to 5.79 million. Economists polled by Thomson Reuters had expected sales to rise to a rate of 6.12 million.
The federal government had boosted home sales by offering buyers tax credits of up to $8,000. The deadline to get a signed sales contract and still qualify was April 30. Buyers must close their purchases by end of this month.
Still, the tax credits were expected to lift sales in May and June. Lawrence Yun, the Realtors chief economist, said delays in the mortgage-lending process put about 180,000 potential buyers in limbo. He’s unsure if they will qualify by the June 30 deadline.
The trade group is pushing Congress to extend the deadline for closing a sale until Sept. 30.
April’s results were revised upward to 5.79 million.
The drop in May sales was led by a more than 18% decline in the Northeast. Sales were unchanged in the Midwest, but rose nearly 5% in the West and 0.5% in the South.
The inventory of unsold homes on the market was down 3.4% to 3.9 million. That’s an 8.3 month supply at the current sales pace, compared with a healthy level of about six months. The median sales price in May was $179,600, up 2.7% from a year earlier.
Copyright 2010 The Associated Press
