Temporary factors like spiking gasoline prices caused existing home sales to fall 3.8 percent in May to an annual rate of 4.81 million from a downwardly revised 5 million rate in April, according to the National Association of Realtors. Sales are 15.3 percent below the 5.68 million pace in May 2010, when sales surged as buyers looked to beat the deadline for the homebuyer tax credit. The current rate is the lowest yet for 2011.
Single-family existing home sales declined 3.2 percent to an annual rate of 4.24 million from 4.38 million in April, and are 15.4 percent below a surge to 5.01 million one year ago. The median existing single-family home price was $166,700 in May, down 4.5 percent from May 2010.
"Spiking gasoline prices along with widespread severe weather hurt house shopping in April, leading to soft figures for actual closings in May," said NAR Chief Economist Lawrence Yun. "Current housing market activity indicates a very slow pace of broader economic activity, but recent reversals in oil prices are likely to mitigate the impact going forward. The pace of sales activity in the second half of the year is expected to be stronger than the first half, and will be much stronger than the second half of last year."
