Existing Home Sales Rise Following Falls

ByJohn S. McClenahen After declining in July and August, sales of existing single-family homes rose again in September, according to data released on Oct. 25 by the Chicago-based National Association of Realtors (NAR). September sales were at a seasonally adjusted annual rate of 6.75 million units, up 3.1% from August's 6.55 million rate. A steady decline in mortgage interest rates since June is now translating into higher sales, says David Lereah, NAR's chief economist. "Since 1971, there have been only five months when mortgage interest rates were lower, and all of those have been during the last year and a half," he notes. "The good news is that interest rates have been fairly stable over the last month, hovering near generational lows, and that is increasing the purchasing power of buyers trying to get into the housing market." Observes UBS Investment Research, "With mortgage applications moving sideways in October, the implication is that existing sales could be set for another gain this month."