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U.S. Existing Home Sales Unexpectedly Dip 0.4% In April

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Existing home sales in the U.S. unexpectedly showed a modest decrease in the month of April, according to a report released by the National Association of Realtors on Tuesday.

NAR said existing home sales dipped by 0.4 percent to an annual rate of 5.19 million in April after plunging by 4.9 percent to a rate of 5.21 million in March.

The continued decrease came as a surprise to economists, who had expected existing home sales to jump by 2.7 percent to a rate of 5.35 million.

NAR chief economist Lawrence Yun said he is not overly concerned about the unexpected drop in existing home sales and expects moderate growth very soon.

"First, we are seeing historically low mortgage rates combined with a pent-up demand to buy, so buyers will look to take advantage of these conditions," Yun said.

He added, "Also, job creation is improving, causing wage growth to align with home price growth, which helps affordability and will help spur more home sales."

The report said the median existing home price for all housing types in April was $267,300, up 2.9 percent from $259,700 in March and up 3.6 percent from $257.900 in the same month a year ago.

Total housing inventory increased to 1.83 million existing homes available for sale at the end of April, representing 4.2 months of supply at the current sales pace.

"We see that the inventory totals have steadily improved, and will provide more choices for those looking to buy a home," Yun said. "When placing their home on the market, home sellers need to be very realistic and aware of the current conditions."

NAR said single-family home sales fell by 1.1 percent to an annual rate of 4.62 million in April, while existing condominium and co-op sales surged up by 5.6 percent to a rate of 570,000.

On Thursday, the Commerce Department is scheduled to release a separate report on new home sales in the month of April. New home sales are expected to slump by about 2.8 percent.

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