(Reuters) - Sales of previously owned U.S. homes plunged in February and prices hit their lowest level in nearly nine years, implying a housing market recovery was still a long way off.
The National Association of Realtors said on Monday sales fell 9.6 percent month over month to an annual rate of 4.88 million units, snapping three straight months of gains. The percentage decline was the largest since July.
The weak sales were the latest evidence of the malaise in the housing sector and confirmed it would remain outside the strengthening and broadening economic recovery.
"The housing market is still very depressed and a major drag on the economy, especially household net worth," said Chris Christopher, a senior economist at IHS Global Insight in Lexington, Massachusetts.
Economists had expected a decline of only 4 percent to a 5.15 million-unit pace. The actual drop was greater than even the most pessimistic forecast in a Reuters survey of 53 economists.
Analysts said harsh winter weather in January could have curbed February sales. Existing home sales are measured when contracts are closed and last month's sales decline was telegraphed by a drop in January's pending contracts.
The Realtors' group also said tight credit conditions and home appraisals that fell short of agreed-upon selling prices weighed on sales.
U.S. financial markets largely ignored the data. U.S. stocks rose sharply, partly on news of a bid by AT&T for Deutsche Telekom AG's T-Mobile USA and growing hopes Japan would get its nuclear crisis under control.
Prices for U.S. government debt fell after the Treasury said it would begin selling $142 billion in mortgage-backed securities it had acquired to help tame the financial crisis. The dollar rose against the yen on intervention fears.
rest http://www.reuters.com/article/2011/03/21/us-usa-economy-housing-idUSTRE72F3XG20110321
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