Another plunge for Existing Home Sales

From marketwatch.com

Home sales crater on credit squeeze

Sales of existing homes and condos fell to a seasonally adjusted annual rate of 5.04 million, the lowest since 1999, when the real estate group began tracking combined single-family and condo sales. The 8% drop was the largest monthly percentage decline in that period.

Nationwide, sales of existing homes were down 19.1% in September compared with September 2006. Sales fell in all four regions.

The deepening subprime crisis is threatening a recession, said Peter Morici, a business professor at the University of Maryland. Lehman Bros. now expects the Federal Reserve to cut its overnight lending rate by a full percentage to 3.75% by the middle of 2008, including a rate cut next week.

"The housing crunch is accelerating; the Fed can't stand by and watch," wrote Ian Shepherdson, chief U.S. economist for High Frequency Economics.

Sales were much weaker than the 5.22 million pace expected by economists surveyed by MarketWatch....

Inventories of unsold homes and condos rose to a 10.5-month supply, the largest in at least eight years....

The median sales price for homes and condos was $211,700, down 4.2% in the past year. Median sales prices have fallen in 13 of the past 14 months.

Well what did you expect? Regardless of what chief chucklehead of NAR, Lawrence Yun says, things are not going to turn around anytime soon in the housing market. However I will say that inventories look as though they could be peaking as all the homebuilders that have reported 3Q07 earnings so far have managed to work off some of their inventory.