Existing Home Sales totaled 5.1mm annualized, 250k less than expected and down from 5.24mm in July. The chief economist placed some blame for the shortfall in closings relative to expectations on “rising numbers of contracts entering the system, with some fallouts and a backlog contributing to a longer closing process.” The NAR said 30% of buyers were 1st time, where many took advantage of the tax credit, and 31% of sales were distressed. The median price fell 12.5% y/o/y and 2.1% m/o/m. The positive within the data was months supply which fell to 8.5 from 9.3 and is the lowest since Apr ’07. The two key hurdles the industry must now face is an inevitable increase in foreclosures as many 1st half moratoriums have come to an end and the uncertain destiny of the tax credit which the industry is certainly begging but has become an expensive subsidy from the rest of us.
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