U.S. home resales fell more than expected in October, with large declines in regions which have experienced the biggest price gains, but the underlying trend suggested housing remained on firmer footing.
The National Association of Realtors said on Monday existing home sales declined 3.4% to an annual rate of5.36 million units. September's sales pace was unrevised at 5.55 million units and was the second highest since 2007.
Sales were up 3.9% from a year ago. Despite the drop last month, sales held above their average for the year and are on track to record their best annual sales in eight years.
Housing is being supported by a strengthening labor market, which is boosting household formation by encouraging young adults to leave parental homes. It, however, remains constrained by a persistent shortage of houses for sale, which has driven up prices and sidelined first-time buyers.
Economists had forecast sales falling to a rate of 5.40 million units last month. Sales dropped 8.7% in the West and fell 3.2% in the South. According to the Realtors group, these two regions have experienced large price increases due to tight inventory.
Sales slipped 0.8% in the Midwest and were unchanged in the Northeast.