A decrease in investor purchases prompted an unexpected decline in sales of U.S. existing homes in August, indicating the housing rebound is not yet self-sustaining.
Purchases of previously owned houses dropped 1.8 percent to a 5.05 million annual pace from a 5.14 million rate in July, the National Association of Realtors reported today in Washington. The share of properties sold to investors was the lowest in almost five years, the group said.
Transactions at the lower end of the market are suffering as the potential for higher interest rates makes housing a less attractive investment. First-time buyers have yet to fill the void amid slow wage gains and tight credit conditions.
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