Prices Climb Amid Record Sales of Homes
Bloomberg News
Low mortgage rates in June are credited with brisk sales of existing homes in July. Mortgage rates have risen in recent weeks.
By BLOOMBERG NEWS
Sales of previously owned homes rose to a record in July and prices recorded the biggest 12-month gain in almost 23 years, an industry report indicated yesterday.
Sales totaled 6.12 million at an annual pace, up 5 percent from June's 5.83 million pace and the third increase in the last four months, the report from the National Association of Realtors said. The increase was spurred by interest rates that in June had fallen to a low point in recent years. Economists had expected a 5.9-million-unit pace of home resales.
Mortgage rates have since risen, which may restrain home sales later this year and limit housing's contribution to economic recovery, economists said. While a rise of one percentage point in the average 30-year fixed rate since June may keep sales from strengthening, an accelerating economy will underpin the market for homes.
"It's likely that we have hit the peak," said Van Davis, president and chief executive of the Century 21 Real Estate Corporation. "The good news is that I don't see a significant slowdown. The economy is picking up, real wages are rising and interest rates are still low, and in that environment," housing will not slump. |
