14 August 2008 18:03 [Source: ICIS news]
HOUSTON (ICIS news)--Existing home sales in the US during the second quarter were down 16.3% compared with the second quarter of 2007, the National Association of Realtors (NAR) said on Thursday.
Some 4.91m existing home units were sold in the second quarter, down 0.8% from the first quarter’s sales of 4.95m units. Sales in second quarter 2007 were 5.87m units, the NAR said.
“Once the inventory is drawn down, price pressure will return because the costs of construction are rising - today’s buyers are very well positioned to build wealth over time,” NAR president Richard Gaylord said.
Foreclosures continued to keep home values low, the NAR said. Foreclosed properties typically sell at a discount to comparable homes so that banks can liquidate them and recover unpaid mortgages quickly.
Sales of existing homes are one indicator of demand for chemicals and chemical related products. Existing homes are often painted, re-carpeted or otherwise refurbished to attract buyers in a depressed market, analysts said.
While new home construction is a greater indicator of demand for the chemical markets, existing home sales are important to consider since builders tend to wait until home inventories drop before undertaking major home-building activity.
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