NAR: Existing-home sales drop for sixth straight month
Existing-home sales — including homes, condos and co-ops — fell in August for the sixth straight month to a seasonally adjusted annual rate of 5.5 million units in August from a level of 5.75 million in July, a drop of 4.3 percent. That rate is 12.8 percent below the 6.31 million-unit pace last year, according to the National Association of Realtors.
Lawrence Yun, NAR senior economist, said the decline was expected, especially following “unusual” disruptions in the mortgage market. Those disruptions included a significant rise in rates for jumbo loans and a higher number of canceled or postponed sales.
“Lower sales contributed to a buildup of unsold inventory,” Yun said. “Once we get through these disruptions, we’ll get a better sense of where the actual market is in late fall as conditions begin to normalize.”
Total housing inventory rose 0.4 percent at the end of August to 4.58 million existing homes available for sale, which represents a 10-month supply at the current sales pace, up from a 9.5-month supply in July.
The national median existing-home price for all housing types was $224,500 in August, up 0.2 percent from August 2006 when the median was $224,000.
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage was 6.57 percent in August, down from 6.7 percent in July; the rate was 6.52 percent in August 2006.
Last week, Freddie Mac reported the 30-year fixed rate was down to 6.34 percent.
Single-family home sales fell 3.8 percent to a seasonally adjusted annual rate of 4.81 million in August from a pace of 5 million in July, and are 13.0 percent below the 5.53 million-unit level in August 2006.
Existing condominium and co-op sales dropped 8 percent to a seasonally adjusted annual rate of 690,000 units in August from 750,000 in July, and are 11.7 percent lower than the 781,000-unit pace a year ago. The median existing condo price was $228,500 in August, up 2.1 percent from August 2006.
Regionally, existing-home sales in the Northeast slipped 2 percent in August to an annual pace of 1 million, 5.7 percent below a year ago. The median price in the Northeast was $282,300, up 3.6 percent from August 2006.
Existing-home sales in the South fell 2.7 percent to a level of 2.2 million in August, and are 12.7 percent lower than August 2006. The median existing-home price in the South was $183,500, down 0.7 percent from a year ago.
Existing-home sales in the Midwest fell 5.2 percent to an annual rate of 1.28 million in August, and are 10.5 percent below a year ago. The median price in the Midwest was $177,100, up 3.1 percent from August 2006.
Existing-home sales in the West dropped 9.8 percent in August to a level of 1.01 million, and are 21.7 percent below August 2006. The median price in the West was $332,300, which is 3.8 percent below a year ago.
Wal-Mart to evaluate energy used by certain suppliers
Wal-Mart Stores has announced a plan to measure energy used by its suppliers in seven product categories: vacuum cleaners, soap, DVDs, toothpaste, milk, soda and beer.
The company is partnering with the non-profit group Carbon Disclosure Project to help evaluate the amount of energy used to make products and move them through the supply chain.
The goal is to, following the evaluation, launch a pilot project to make the supply process more energy efficient.
The products were chosen because they are ordinary products that customers commonly use, Wal-Mart said. Wal-Mart has been involved in several “green” initiatives in recent years, including plans to make stores more energy efficient and promotions on compact fluorescent light bulbs.
Wolseley year-end income down on U.S. housing slump
Wolseley, the British parent of Stock Building Supply, saw its yearly pre-tax net income fall 17.6 percent, to 634 million pounds (US$1.3 billion) from 769 million pounds (US$1.55billion), primarily because of lower demand in its U.S. business, the company said.
Revenue rose 14.6 percent to 16.2 billion pounds (US$32.7) from 14.16 billion pounds (US$28.6) last year. Sales growth primarily was driven by bolt-on acquisitions and the company’s expansion in the Nordic region, an area that performed better than expected. Earlier this year, Wolseley expanded its Nordic region DT Group with the acquisition of Swedish building supply company Save Tra Forsaljnings.
“Recent events relating to the subprime market in the U.S. and the subsequent concerns over liquidity in global financial markets have created uncertainty,” the company said in a statement. “It is too early to assess whether these trends will continue.”
The company went on to say that while it believes “there are no signs yet of any upturn in the U.S. housing market,” commercial and industrial markets, as well as the European building supply market, are expected to remain strong.
In July, Wolsley announced it would close 24 Stock Building Supply locations, leading to the reduction of 370 employees. The company earlier closed 22 Stock branches and reduced its headcount at the division by 4,500.