Third-Quarter Home Sales Drop

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New home sales figures are out, and the news isn't good. The National Association of Realtors says 4 out of 5 metropolitan areas saw home prices drop in the third quarter, compared with the year before. Meanwhile, sales of existing homes fell in 32 states.


Home sales are picking up in a few parts of the country, mostly places where prices fell so far that houses have become attractive again. But looking on a national scale, new data shows that the overall picture is still grim for the housing market. NPR's Tamara Keith reports.

TAMARA KEITH: Four out of five metropolitan areas saw home prices drop in the third quarter, compared to the year before. That's according to the latest quarterly survey from the National Association of Realtors. Meanwhile, sales of existing homes fell in 32 states. And if existing homes aren't selling, that means there's trouble for builders of new homes. The National Association of Home Builders/Wells Fargo Housing Index, which measures builder confidence in the market for new homes, fell to nine in November. That's on a scale of 100.

Mr. JERRY HOWARD (President and CEO, National Home Builders Association): What it signals is that we're in a crisis situation.

KEITH: Jerry Howard is president and CEO of the Home Builders Association. He blames the credit crunch hitting both mortgages and the lending that builders need to launch projects.

Mr. HOWARD: Both ends of the pipeline are clogged. There's no money available. And the builders are in a desperate strait right now.

KEITH: He's calling on Congress to include incentives to buy homes in any future economic stimulus package. Tamara Keith, NPR News, Washington.

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