Existing home sale plunge 9.7% in 3rd straight monthly drop

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WASHINGTON - Existing home sales in the U.S. plunged 9.7% in May. It was the third straight monthly decline and further evidence of the harm the virus pandemic has done to the housing market.

The National Association of Realtors said Monday that the monthly decline pushed sales down to a seasonally adjusted annual rate of 3.91 million, the slowest pace since a home buyers tax credit expired in October 2010.

Sales fell in all regions of the country, with the biggest decline coming in the Northeast where virus infections were especially heavy.

Sales of both existing and new homes have fallen sharply during the traditional spring selling season as communities were locked down to prevent the spread of the coronavirus.

Sales in the Northeast slumped 13.9% from the previous month while sales in the West fell 11.1%. Sales slid 10% in the Midwest and 8% in the South.

The median price of a home sold in May was $284,600, up 2.3% from a year ago.

Lawrence Yun, chief economist of the Realtors, said based on anecdotal reports, he believed May could turn out to be the bottom for the housing market with sales showing a V-shaped recovery in coming months. However, many private economists believe the recovery from the disruptions caused by the coronavirus could take much longer.