Washington – Sales of existing homes dropped for a fifth straight month in July while the number of unsold homes shot up to a record level.
Many analysts said the worst slump in housing in 16 years is likely to deepen in coming months, reflecting the recent turmoil in credit markets, which has caused lenders to tighten their standards.
The National Association of Realtors reported Monday that sales of existing homes dipped by 0.2 percent in July, compared with June, to a seasonally adjusted annual rate of 5.75 million units.
The median price of a home sold last month slid to $230,200, down by 0.6 percent from the median price a year ago. It marked the 12th consecutive month that home prices have declined, a record stretch.
The deep slump in housing, combined with recent severe turmoil in financial markets, has raised worries about a possible recession.
But many economists believe the Federal Reserve will ward off a full-blown downturn by reducing a key short-term interest rate should financial markets fail to stabilize.
But economists said the report on existing-home sales signaled further trouble ahead, given a big jump in the inventory of unsold homes, which rose by 5.1 percent to a record 4.59 million homes.
