Existing-Home Sales Tumble

Existing-home sales plunged in December, dropping lower than expected after three straight increases that were fed by a fat government tax credit.

Home resales fell by 16.7% to a 5.45 million annual rate from an unrevised 6.54 million in November, the National Association of Realtors said Monday.

Monday's data said inventories shrank, and prices rose year over year for the first time in more than two years.

Economists surveyed by Dow Jones Newswires expected an 11.6% decrease in sales during December, to a rate of 5.78 million.

Banks are making it difficult for some people to get loans. Joblessness in the U.S. is high, muting the economy's recovery.

"The market is going through a period of swings driven by the tax credit," NAR economist Lawrence Yun said. "We'll likely have another surge in the spring as home buyers take advantage of the extended and expanded tax credit."

Click Here to Read the Entire Story: WSJ