Existing-Home Sales
Resume Decline

Existing-home sales resumed tumbling in December and the median price dropped.

Home resales fell to a 4.89 million annual rate, a 2.2% decrease from November's unrevised 5.00 million annual pace, the National Association of Realtors said Thursday. For 2007, existing home sales tumbled 13% to 5.652 million, the NAR said.

The median home price was $208,400 in December, down 6.0% from $221,600 in December 2006. The median price in November this year was $208,700. For 2007, the median price fell 1.4% to $218,900.

NAR economist Lawrence Yun said the market is suffering "uncharacteristic weakness."

"Home sales remain weak despite improved affordability conditions in many parts of the country," Mr. Yun said.

The December resales level was below Wall Street expectations of a 4.98 million sales rate for previously owned homes.

The average 30-year mortgage rate was 6.10% in December, down from 6.21% in November, according to Freddie Mac.

Inventories of homes fell 7.4% at the end of December to 3.91 million available for sale, which represented a 9.6-month supply at the current sales pace. There was a 10.1-month supply at the end of November, revised from a previously estimated 10.3 months.

Regionally, existing-home sales fell 1.7% in the Midwest, 4.6% in the Northeast, 2.1% in the West, and 1.0% in the South.

Jobless Claims Decline

The number of U.S. workers filing new claims for unemployment benefits fell unexpectedly last week for a fourth-straight week, suggesting that a resilient labor market at the start of the year might keep the U.S. economy from sliding into recession.

Initial claims for jobless benefits fell 1,000 to 301,000 after seasonal adjustments in the week ended Jan. 19, the Labor Department said Thursday. That marked the fourth-straight weekly decline to a four-month low. Wall Street economists had expected a sharp increase of 19,000.

There were no special factors, a Labor Department analyst said. The four-week average of new claims, which economists use to smooth out weekly volatility, tumbled 14,000 to 314,750, the lowest level since Oct. 6. Claims for the week ending Jan. 12 were revised up 1,000 to 302,000.

Recent jobless claims data run counter to other figures, particularly monthly employment, that have suggested a much weaker jobs market. Indeed, an unexpected jump in the unemployment rate in December, to 5% from 4.7%, reported early this month was likely a factor in the Fed's surprise decision on Tuesday to lower the federal funds rate between scheduled meetings by 75 basis points to 3.5%.

Officials are expected to lower the fed funds rate another half-percentage-point at its Jan. 29-30 meeting to 3%, though the claims data suggest the economy might not need that much stimulus.

According to the Labor Department report Thursday, the number of workers drawing unemployment benefits for more than one week fell 75,000 to 2,672,000 in the week ended Jan. 12. That's the biggest weekly decline since May 5.

The four-week average of those continuing claims fell by 10,250, breaking a streak of 12-straight increases, suggesting it is getting a little easier for unemployed people to find work.

The unemployment rate for workers with unemployment insurance fell to 2% in the Jan. 12 week from 2.1% the prior week.

There were 36 states and territories reporting an increase in initial jobless claims for the Jan. 12 week, while 17 reported a decrease.

On an unadjusted basis, California reported the biggest increase in new claims, 27,194, due to layoffs in construction and service industries. New York reported the sharpest decrease, 25,349, due to fewer layoffs in the construction, service and transportation sectors.

-- Brian Blackstone contributed to this article.

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