July 26, 2007	Thursday	Rajab 10, 1428

WASHINGTON, July 25: Sales of existing US homes fell much more heavily than predicted in June to their lowest level in over four and a half years as the property market continued to display shaky foundations, an industry survey showed on Wednesday.

The survey was released a day after the chief executive of Countrywide Financial, one of America’s biggest mortgage lenders, said there was scant relief in sight this year for the distressed property market.

The National Association of Realtors said existing home sales dropped 3.8pc to an annualised pace of 5.75 million last month, worse than analyst forecasts which had anticipated only a decline to 5.90 million properties.

May sales were revised down to a rate of 5.98m apartments and homes, and sales have now fallen for four straight months.

“The news was bad, as expected. Sales were down nationally,” said Patrick Newport, an economist at Global Insight.

“When will sales turn around? Our view is that the downturn will continue into 2008. Given the level of unsold homes, however, nominal home prices will probably not rebound until 2009,” Newport said.

The association said potential home buyers appeared reluctant to commit a purchase.

“Home buyers have been getting mixed signals about the housing market, which is causing some of them to hesitate,” said NAR senior economist Lawrence Yun.

Analysts say rising home foreclosures and mortgage problems, particularly with loans granted to Americans with stretched finances, are roiling the nation’s housing market.

But it is not just homeowners who are feeling the pain. Countrywide Financial reported a hefty 33 per cent profit slide Tuesday as its second-quarter profit moderated to $485 million.

“During the quarter, softening home prices continued to affect many areas of the country and delinquencies and defaults continued to rise across all mortgage product categories as a result,” Countrywide CEO Angelo Mozilo said. —AFP