Home Sales Up 3.3% in July, but Gulf-Related Slowdown Expected: EXISTING HOME SALES
Existing home sales rose for a second straight month in July, a real estate trade group said yesterday, hut analysts predicted a slowdown because of rising mortgage rates linked to the crisis in the Persian Gulf.</br></br>"Iraq's craziness will be felt in U.S. housing markets," said Norman D. Flynn, president of the National Association of Realtors. He said mortgage rates reversed a downward course after the Aug. 2 Iraqi invasion of Kuwait and jumped back into double digits.</br></br>In addition to the discouraging higher rates, "a war situation causes consumer confidence to fall,Û said</br></br>Richard Peach, deputy chief economist for the Mortgage Bankers Association. "People become unwilling to take on major responsibilities like buying a new house."</br></br>The Realtors association said house resales rose 3.3 percent to a seasonally adjusted annual rate of 3.44 million units in July following a 0.9 percent gain in June. The June advance was the first in seven months.