WASHINGTON, Nov 24: Existing US home sales fell 3.1 per cent in October as buyers remained on the sidelines amid economic uncertainty, the National Association of Realtors said on Monday.

The industry group said sales of homes and apartments dropped to a seasonally adjusted annual rate of 4.98 million units, below the consensus forecast of private economists of a pace of 5.05 million.

The level is 1.6 per cent below that of October 2007 and highlights the ongoing distress in the US real estate market, whose collapse after a years-long boom has triggered widespread economic chaos and massive losses for the financial system.

The market had staged a modest rebound in September but could not sustain the pace amid renewed economic and market turmoil.

“Many potential home buyers appear to have withdrawn from the market due to the stock market collapse and deteriorating economic conditions,” said Lawrence Yun, NAR’s chief economist.

“We have favourable affordability conditions, but we need more than that to give buyers with jobs the confidence they need.

This is why a housing stimulus is so critical now to encourage more buyers to draw down the inventory and stabilise home prices. Without home price stabilization, there will not be an economic recovery.”

The inventory of unsold homes at the end of October slipped 0.9 per cent to 4.23 million homes, a 10.2-month supply at the current sales pace.

The glut in homes for sales helped push down the median sales price to $183,300, a drop of 11.3 per cent over the past 12 months.

“The housing market is still in search of a bottom,” said John Ryding at RDQ Economics.

“Once again the good news is that the level of single-family home sales continues to bounce around in the range seen since September last year.—AFP