By Max Fisher of The Atlantic Wire
U.S. pending home sales, home construction, and mortgage applications all declined significantly in May, according to newly released statistics. While the drop was expected due to an expiring federal tax-credit for home buyers, it fell at twice the expected rate of 15 percent, meaning that sales decreased by 30 percent in a single month. This is especially unusual because May is typically considered high season for home buying. The drop brings the number of pending home sales to the lowest since it was first recorded in 2001. It is also the largest percentage decline in home sales since 1963. Because home sales are a forward-looking indicator, unlike job growth which is a lagging indicator, this could have serious consequences for long-term economic growth.
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