The struggling housing industry showed more weakness Friday, as sales of existing homes slid last month despite lower costs for a home.
The National Association of Realtors reported that sales of existing homes fell 2.6 percent in April to a seasonally adjusted annual rate of 5.99 million units, marking the slowest sales pace since June 2003.
The report follows a much different one on Thursday showing that sales of new homes soared by 16 percent to a seasonally adjusted annual rate of 981,000 units, marking its biggest month-to-month gain in 14 years, according to the U.S. Commerce Department.
Economists' said the mixed results are further evidence that the housing market remains on shaky footing.
The glimmer of hope gleaned from the new home sales numbers fades amid existing home sales figures because existing home sales are a much bigger part of the market.
Mark Zandi, chief economist with Economy.com, said the housing slump is far from over.
"Today's numbers are a much closer representation to reality. I think the market is soft, sales are down, construction is off, and pricing is at best flat," Zandi said.
That's good news for home buyers who've been waiting for prices to come down.
The median price (the midway point between the costliest and cheapest) of an existing home fell to $220,900. That's down 0.8 percent from the midpoint a year ago, and marks the ninth straight decline in the median price.
Meanwhile, the median price of a new home tumbled 11 percent, the biggest monthly price decline on record, to $229,100.
Zandi says home-builders are making bigger price-cuts because of all the unsold homes sitting on the market.
"Home builders are leading the way here," he asserts. "They realize they need to cut prices and that's what they're doing."
So builders might not just offer to throw in a flat-panel television to sell a condo or new home. They might be more willing to drop the price by $20,000 or $30,000.
"Builders are pulling out all stops to work down heavy inventories in the face of weak demand that's been exacerbated by the subprime-related tightening of mortgage credit conditions," said Brian Catalde, president of the National Association of Home Builders and a home builder from El Segundo, Calif. "Our surveys show that the majority of builders are cutting prices and offering substantial non-price sales incentives, and their efforts are bearing fruit."