THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Tuesday, March 28, 1995 TAG: 9503280367
SECTION: BUSINESS PAGE: D1 EDITION: FINAL
SOURCE: STAFF AND WIRE REPORTS
LENGTH: Short : 38 lines
Sales of previously owned homes plunged 5 percent in February as a slowing economy combined with high mortgage rates to depress the housing industry.
Except for a slight increase in December, sales have not advanced since March 1994, according to a report Monday by the National Association of Realtors. All regions in the country shared in the decline.
Hampton Roads' home sales declined 7.3 percent in February over the same month in 1994, according to the Virginia Association of Realtors. Pending sales of single-family homes, the best local indicator of home sales, fell to 1,570 in February, compared with 1,762 in February 1994.
Pending home sales throughout the state fell 9.6 percent in February.
National sales of existing single-family homes totaled a seasonally adjusted annual rate of 3.43 million, the Realtors said, down from 3.61 million in January and 3.84 million in February 1994.
It was the second straight decline since a 1.9 percent gain in December - and that December increase was the first since March 1994. Sales were unchanged in April and May.
Although interest rates have slipped slightly in recent months, 30-year, fixed-rate mortgages averaged 8.77 percent in February. Although that was down from 9.15 percent in January, it was well above the 7.15 percent rate a year earlier and continued to cut into housing affordability.
Higher short-term rates engineered by the Federal Reserve have slowed the creation of jobs, which has offset the slight recent decline in mortgage rates, said the national Realtors' president, Edmund G. Woods Jr. by CNB