Sales of Existing Homes Fall to 16-Month Low

Prospective home buyers failed to take advantage of falling mortgage rates in May, judging from the fact that sales of existing homes fell 5.6% to their lowest level in 16 months, the National Assn. of Realtors reported Monday.

The real estate trade group said sales of single-family homes fell last month to a seasonally adjusted annual rate of 3.21 million units, down from 3.4 million units in both March and April. The May resale rate was off 11.3% from a year ago, the association said, and was the lowest since January, 1988, when 3.2 million units were sold.

The statement from the national group followed last week’s report by the California Assn. of Realtors that the pace of sales of existing homes in California had fallen even more sharply, dropping 9.5% below that of May, 1988.