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Existing Home Sales Dive 3.4% in November

December 31, 1985|Associated Press

WASHINGTON — Sales of existing single-family homes fell 3.4% in November, the sharpest drop in nine months, a real estate trade group reported Monday.

The National Assn. of Realtors said previously owned homes were sold at a seasonally adjusted annual rate of 3.43 million units in November, following a 2.9% rise in October.

Even with the decline, which was the sharpest since a 4% drop in February, sales were still 21.2% above where they were a year ago. November marked the ninth consecutive month in which the annual sales rate was above the 3 million mark.

Housing analysts blamed bad weather in parts of the country for the November decline and predicted continued gains in coming months.

"We don't expect this to be the beginning of a downward trend," said Clark E. Wallace, association president. "Rather, we expect home resale activity to improve next year, even over this year's banner performance."

Wallace said sales of previously owned homes will probably total 3.19 million for all of 1985, an 11% gain over 1984.

Analysts attributed the upsurge in activity to falling interest rates, relatively stable home prices and a good supply of homes for sale.

The median price of an existing home dropped by $200 from October to a November figure of $74,600, but this was still 3.8% higher than the price a year ago.

By region, sales of homes fell 8.3% in the Northeast following three months of relatively hefty increases. Sales were off 5.3% in the Midwest and 4.7% in the West. Only the South posted a sales gain last month, a 2.4% advance that put total sales at an annual rate of 1.27 million units.

Jack Carlson, chief economist for the association, predicted that home sales would grow between 3.5% and 4% in 1986 and climb another 4% in 1987.

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