Home sales tumble across country

WASHINGTON - Sales of existing homes tumbled more sharply than expected in June, pushing activity down to the lowest level in more than a decade.

With an already huge glut of homes on the market, median prices fell compared to a year ago and analysts predicted prices would keep falling until next spring as tighter credit, a slipping job market and rising foreclosures scare potential buyers away.

The National Association of Realtors reported Thursday that sales dropped by 2.6 percent last month to a seasonally adjusted annual rate of 4.86 million units, the slowest sales pace since the first quarter of 1998.

The decline was more than double the 1 percent drop that economists had been expecting and left sales 15.5 percent below where they were a year ago.

The downward slide in sales depressed prices, too. The median price for a home sold in June dropped to $215,100, down by 6.1 percent from a year ago. That was the fifth largest year-over-year price drop on record.

Inventories of homes on the market rose by 0.2 percent to 4.49 million units, meaning it would take 11.1 months to exhaust the current backlog at the June sales pace, the second highest level in the past 24 years. The glut of unsold homes is being made worse by a rising wave of foreclosures.