Pending Home Sales Fall To Record Low

Factory Sales Also Drop, But Service Industries Show Less Contraction Than Anticipated

(CBS/AP)  Pending U.S. home sales fell to the lowest level on record in November, as the plummeting stock market and faltering economy caused buyers to delay their purchases, the National Association of Realtors said Tuesday.

The index, which tracks signed contracts to purchase existing homes, fell 4 percent to 82.3 from a downwardly revised reading of 85.7 in October. That was far worse than the reading of 88 that economists expected, according to Thomson Reuters.

Typically there is a one- to two-month lag between a contract and a done deal. So November's decline foreshadows bleak results for December's existing home sales numbers, set to be release Jan. 26.

Sales contracts fell around the U.S., but were weakest in the Northeast and Midwest.

Also, the Commerce Department reported today that orders to factories fell for a record fourth straight month in November, and analysts believe manufacturing will continue to suffer in coming months as the U.S. slogs through a recession entering its second year.

Orders declined by 4.6 percent in November, nearly double the 2.5 percent drop economists expected. Orders have been falling since August, including a 6 percent plunge in October, the biggest setback in eight years.

The weakness in November reflected a big drop in demand for commercial aircraft. Weakness also was seen in autos, primary metals such as steel, and defense communications equipment.

While investors expected the data to show further deterioration, they were hoping the pace of the declines would slow. The market is eager for signs that the U.S. recession will end this year.

One bright spot among the day's reports: the Institute for Supply Management said the U.S. services sector contracted at a slower pace last month. The trade group of purchasing executives said its services sector index rose to 40.6 in December from 37.3 in November. Wall Street economists had expected the index to slip slightly to 37.

In midmorning trading, the Dow Jones industrial average rose 44.29, or 0.49 percent, to 8,997.18, after rising as much as 122 points prior to the readings. The Standard & Poor's 500 index rose 4.89, or 0.53 percent, to 932.34, while the Nasdaq composite index advanced 12.40, or 0.76 percent, to 1,640.43.


Stimulus For Real Estate Urged

The Realtors' pending home sales index was down 5.3 percent from November 2007, and now sits at the lowest since in its eight-year history - beating the previous record low of 83 in March 2008.

An index reading of 100 is equal to the average level of sales activity in 2001, when the index started.

Lobbyists for the real estate industry are using the deteriorating housing market data to call on President-elect Barack Obama to devote attention to sinking home prices and sales - the genesis of the recession.

"A real estate-focused stimulus plan is urgently needed," Lawrence Yun, the trade group's chief economist, said in a statement.

The U.S. has been coping with the worst housing recession in decades, and many in the real estate, banking and mortgage industries are poring through each month's data for signs of a bottom, with no luck so far.

U.S. existing home sales plunged to a rate of 4.49 million in November, down 8.6 percent from October. When the final tally for 2008 is complete, it is likely to be the worst year for home sales in at least in a decade. Plus, with job losses mounting, there appears to be no quick turnaround this year.

Indeed, the contracting economy makes the timing of any recovery a moving target. Home sales are growing in foreclosure-plagued areas like Las Vegas and Los Angeles, but are still sinking in most of the country. The Realtors group estimates that 45 percent of existing home sales are now foreclosures and other distressed properties.

Yun, however, forecasts a modest increase in home sales for 2009. He projects sales will be up 6.6 percent, after plunging by around 13 percent in both 2007 and 2008. Prices are forecasts to remain relatively level with a median of $198,100 this year, up from $197,000 last year.


U.S. Factory Orders Drop More Than Expected In Nov.

The factory orders report showed that demand for durable goods, items expected to last three or more years, fell by 1.5 percent in November, even worse than the government's initial estimate two weeks ago that durable goods had fallen 1 percent.

Demand for nondurable goods, items such as food, paper and petroleum products, dropped by 7.4 percent in November following a 3.8 percent decline in October. The declines for nondurable goods reflect falling demand and a big drop in prices, particularly for energy products.

The declines in November were led by a 37.7 percent plunge in demand for commercial aircraft, an extremely volatile series. Boeing Co. has been seeking to resume normal operations following the interruptions caused by a strike last year.

Demand for autos slipped by 0.1 percent following an even larger 4.1 percent fall in October as automakers continue to struggle with the economic downturn.

Economists are concerned that the manufacturing sector is being hit not only by a recession in the United States but spreading weakness overseas which has pushed many of America's major trading partners into downturns and cut into domestic export sales.

[variant_530]

More fallout from the republicans and the last disastrous eight years. Thanks Bush! Thanks Cheney! Thanks neocons!

Now it''''s time for us real Americans to clean up this mess.

And thanks to all you deadbeats who dont know how to read a loan doc or even care. Just walk away from your mortgage and be comforted with the thought that some liberal will find a way to make you not responsible for your own actions and screw the taxpayer. And thank you Mr. Carter and Mr. Clinton for the community reinvestment act. That really helped allot of people realize the dream of home ownership. Too those it helped dont understand that you have to pay for what you buy.

[renonv5]

Stimulus For Real Estate Urged

No, we don''t need any stimulus for real estate, those astronomical prices have got to come down some more in order to be realistic.

[centerfall94]

More fallout from the republicans and the last disastrous eight years. Thanks Bush! Thanks Cheney! Thanks neocons!

Now it''s time for us real Americans to clean up this mess.

[whitemale08]

Look folks,

Globalization has been discredited!

Globalization was this crazy idea you played as kids when you pretended to have a business in your basement and would stand an unfolded coloring book and tap your fingers on it like it was a type-writer or laptop.

Your neighborhood kids would come over pretend like they are your clients to buy something and then you would disguise your voice to make it sound like an adult.

That''s what the credit derivatives bubble was really about. The British and the Americans thought they can sell credit like a commodity produced from their ''securitazion-machine''.

That securitization-machine is completely broke down and the quadrillions in derivates already produced is dropping from the sky like a meteor waiting for the Federal Reserve to fix the machine.

Well it''s not going to fix the machine, we are going to die if we do not replace this dead financial system fast with a New Bretton Woods fixed-exchange-rate system.

We can hope all we want but it won''t work, civilization around the world is already in the process of breaking down,

and the empty parking lots at closed down shopping malls are testemant to the end of the Wall Street/City of London global financial empire!

[variant_530]

Funny, I don''''''''t see them objecting to posts that criticize only Republicans.

But they might start ANY MINUTE. So, you''''''''ve been warned.

LOL!

Posted by txgrouch2008 at 03:08 PM : Jan 06, 2009


Look Sparky the Democrats are far from perfect but THEY did NOT take a Balanced Budget and a Surplus and turn it into RECORD Debt with RECORD Deficits. THEY did NOT allow a Lobbyist from the Banking Industry to WRITE a Law that took ALL Regulations off the Banking Industry. My point? When you look at the Blame to be placed on Democrats it''''s VERY small when compared to the Blame we MUST place on the Republican Party... VERY SMALL indeed! Sieg Heil Y''''all.

irmcvet971 -- I remind you of the "Community reinvestment act" Brain child of Jimmy Carter and enacted by Bill Clinton that forced banks to loan to individuals that would not otherwise qualify for a loan. Probably one of the biggest issues regarding the demise of housing...

[debinok1]

Everyone saw this coming EXCEPT the trickle down supporters. Inhofe still says Oklahomas economy is stable. Geez, what does it take for these idiots to understand that their warped trickle down economics don''t work?

[lemonskink]

Maybe it will bring prices in everything down to a realistic level for the purchasers.

[irmcvet971]

Funny, I don''''t see them objecting to posts that criticize only Republicans.

But they might start ANY MINUTE. So, you''''ve been warned.

LOL!

Posted by txgrouch2008 at 03:08 PM : Jan 06, 2009


Look Sparky the Democrats are far from perfect but THEY did NOT take a Balanced Budget and a Surplus and turn it into RECORD Debt with RECORD Deficits. THEY did NOT allow a Lobbyist from the Banking Industry to WRITE a Law that took ALL Regulations off the Banking Industry. My point? When you look at the Blame to be placed on Democrats it''s VERY small when compared to the Blame we MUST place on the Republican Party... VERY SMALL indeed! Sieg Heil Y''all.

[irmcvet971]

Capitalism is dead; viva marxism!

Posted by LoonyLeft at 12:19 PM : Jan 06, 2009

So what are you saying swastika breath?? Please don''t tell me you are even suggesting MORE Trickle Down! Please tell me you are MORE intelligent than that! Can YOU, can ANY fascist on these boards tell us ONE MONTH, just ONE MONTH when Trickle Down wasn''t producing RED INK! We even put the Fascist in Complete Control of ALL branches of the Government and handed them a BALANCED BUDGET AND a SURPLUS... guess what?? Yep, NOT ONE MONTH did they operate in the BLACK under Trickle Down. Now it''s well known that fascism causes stupidity but NO ONE can be that bad... Can they?? Sieg Heil Y''all.

[irmcvet971]

Oh give me some MORE "Trickle Down" with a big helping of De-Regulation!! I want to see the entire nation turned into a Mississippi, with Tar Paper Huts and people killing each other for ANY job!! LOL

[paidgopshill]

Posted by LoonyLeft a

I would just like to say that it is the Democrats fault, the CRAs fault, ACORNs fault, Fannie and Freddy%u2019s fault, Barney Franks fault, Wall streets fault and you better believe Clinton%u2019s fault, but%u2026.BUSH IS INNOCENT!!!! HE WASN%u2019T EVEN IN THE OFFICE THE DAY THE ECONOMY STARTED CRASHING!

[whitemale08]

Only Keynesian economics of foolitry would go along with the idea that you can create a bubble out of ''credit derivatives''.

Now that their own ''Minsky moment'' has happened to credit itself, the entire gloval financial system is blown out with nothing to replace it except a New World Order of tyrrany and fuedalism in the name of ''enviromentalism''.

It''s amazing how even after Adam Smith and his invisible hand has been discredtited, you still got these losers on Wall Street financial shows begging the consumer to borrow more money and spend.

These Wall Street/City of London types that can''t see anything else other then stupid Keynesian, supply-side trickled-down voodoo economics, still try and convince Fox Noise listeners to ''get out there to borrow and spend".

WE NEED HOUSING PRICES TO FALL OR WAGES TO RISE!!!!

It''s that simple.