
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: TUESDAY, July 27, 1993                   TAG: 9307270096
SECTION: BUSINESS                    PAGE: B5   EDITION: METRO 
SOURCE: Associated Press
DATELINE: WASHINGTON                                LENGTH: Medium

3 IN A ROW FOR HOME SALES

Low mortgage rates and affordable prices helped drive up sales of previously owned homes in June for the third straight month, and analysts predicted continued growth for the remainder of the year.

Although sales dipped in the West and rain-soaked Midwest, they rose in the South and Northeast, the National Association of Realtors reported Monday.

Nationally, sales rose 1.9 percent, to a seasonally adjusted annual rate of 3.69 million, the Realtors said. Sales in May were revised upward, to 3.62 million from 3.61 million.

Realtors President William S. Chee said the June sales reaffirm previous predictions of a strong summer, traditionally a busy season as families try to get settled in newly purchased homes before school starts.

"Smart buyers are continuing to take advantage of low mortgage rates and sellers are pricing their homes more realistically than they have in previous years," he added.

"We expect to see continued strength in the housing market during the second half of the year," agreed economists at Merrill Lynch & Co. in New York. "Mortgage applications picked up in early July . . . while housing affordability remains extremely favorable."

The Federal Home Loan Mortgage Corp. said 30-year, fixed-rate mortgages averaged 7.42 percent in June, down from 7.47 percent in May. They stood at 7.2 percent last week, near a 22-year low.

The median price of an existing home was $108,900, up 2.3 percent from May but just 3.2 percent from June 1992, the Realtors said. The median means half of the homes cost more and half cost less.

Realtors economist John A. Tuccillo predicted prices would rise at a moderate rate over the next few years, compared with the robust gains of the 1980s.

"We expect appreciation to be steady and slow," he said.

After sliding 2.6 percent in March, sales of previously owned homes rose 2.4 percent in April and 4.9 percent in May. For the first six months, they were 3.1 percent higher than the 1992 period.

Analysts expect sales of new homes also regained momentum in June after plunging 21 percent in May. The government will report June sales figures Friday and economists predicted an increase of about 10 percent.

Sales were up 2.9 percent in the South, to a 1.41 million rate. The median price advanced 6.1 percent to $98,700 over the year.

by CNB