Single-home sales still sag
The sale of existing single-family homes continues to decline, according to Dr. Jack Carlson, chief economist of the National Association of Realtors. "Preliminary estimates indicate existing home sales in November were at a seasonally adjusted annual rate of 3.2 million units," he says. "This is down 3 percent form the October level of 3.3 million, 6 percent from the September level of 3.4 million units, and 9 percent from November 1979."
Early data for December indicate even further sales slippage, he adds.
Monthly payments for the typical 80-percent, 30-year mortgage on a median-priced home of $65,000 has risen from $550 to $680 -- a 24-percent jump -- because of the increase in interest rates.
Since last summer, mortgage interest rates have climbed from an average of 12 1/2 percent to 15 1/2 percent.
"If it weren't for the use of such things as assumptions of existing mortgages and seller acceptance of first and second mortgages, the decline in home-sales activity would undoubtedly have been much greater," he economist says.
Sales dropped 41 percent from late 1979 to the spring of 1980, when interest rates set new peaks.
Further declines are expected during the next 60 days.