Washington Home prices in many parts of the country scream bargain, and mortgage rates haven’t been this low for decades. So why are houses across the nation sitting on the market for so long?
Sales of previously occupied homes in the United States fell 27 percent in July, the weakest showing in 15 years, the National Association of Realtors said Tuesday. It was the largest monthly drop in the four decades that records have been kept.
Potential buyers are hesitating because they think home prices still have further to fall. Potential sellers — those with the stomach to put their homes on the market at all, anyway — are reluctant to lower their prices.
“It really is a self-fulfilling prophecy,” said Aaron Zapata, a real estate agent in Brea, Calif. “If all buyers perceive that home prices are coming down, then they will stop making offers — and home prices will come down.”
While the standoff plays out, home sales are plummeting.
Sharp declines were recorded in each of the four regions the group tracks. Yet the pain is being felt unevenly from state to state and city to city. Some markets are rebounding even as others languish.
Sellers in sluggish markets like Las Vegas and Chicago can expect to wait an average of more than five months to sell their homes, according to real estate brokerage ZipRealty Inc. It’s even worse in Palm Beach, Fla., where it takes nearly six months, longest in the nation.
Other notable business news:
• Argentine president moves to control newsprint. The government moved Tuesday to take over Argentina’s only newsprint maker, alleging two leading newspapers illegally conspired with dictators to control the company three decades ago and then used it to drive competing media out of business.
President Cristina Fernandez said the courts should decide whether the Grupo Clarin and La Nacion media companies should be charged with crimes against humanity — specifically whether the newsprint company was illegally expropriated by the newspapers and the military junta.