Pending Sales of Existing U.S. Homes Decrease 2.6%

The number of contracts to purchase previously owned houses unexpectedly fell in June, indicating demand kept unraveling after the expiration of a homebuyer tax credit.

The index of pending home resales dropped 2.6 percent from the prior month, figures from the National Association of Realtors showed today in Washington. Economists projected a 4 percent gain, according to the median forecast in a Bloomberg News survey. The expiration of a government tax credit on April 30 caused the gauge to slump 30 percent in May, the most since data began in 2001.

The end of the incentive worth as much as $8,000 means a sustained recovery in housing now depends on employment and wage gains, which are taking time to rebound. Personal income and spending unexpectedly stagnated in June, a further indication the economy slowed entering the second half of the year, another report today showed.

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- Posted: 2010-08-03 10:55:34

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