The realtor trade group has the July numbers out. "Sales of previously owned homes plunged in July to the lowest level in 2 1/2 years and the inventory of unsold homes climbed to a new record high. The median price of a home sold last month was up just 0.9 percent from the same month last year and marked the smallest year-over-year increase since May 1995."

"The inventory of unsold homes in July rose to a record high of 3.86 million. That represents a supply of homes still available for 7.3 percent of a month. That is the longest period to exhaust the supply of home since the spring of 1993."

"Existing home sales were 11.2 percent below the 7.13 million-unit level in July 2005. David Lereah, NAR’s chief economist, said higher interest rates dampened sales but that price softening is good news for the housing market because it is drawing buyers."

"'Many potential home buyers have been on the sidelines, some 'kicking the tires,' but mostly waiting for sellers to compromise on prices and terms,' he said. 'Now sellers in many areas of the country are pricing to reflect current market realities. As a result, there could be some lift to home sales, but it’ll likely take some months for price appreciation to rise.'"

"Total housing inventory levels rose 3.2 percent at the end of July to 3.86 million existing homes available for sale, which represents a 7.3-month supply at the current sales pace."

"Regionally, existing-home sales in the South were 7.0 percent below July 2005. Existing-home sales in the Northeast were 12.5 percent below a year ago. Existing-home sales in the Midwest were 10.1 percent lower than July 2005. Existing-home sales in the West were 18.0 percent lower than a year earlier."

"The U.S. had an 'unprecedented housing boom' for about the last 10 years, said Mark Vitner, senior economist at Wachovia Corp. 'It's over, there's no question about it.'"

"Sales have slowed because mortgage rates have risen while soaring price gains have pushed many homes out of reach of typical buyers. 'In addition, there is a large psychological factor restraining home sales--buyers believe they are overpaying and if they hold out they can get a better price, while sellers want to receive the price they would have had at the peak of the housing market,' said Drew Matus, an economist for Lehman Bros."

"The report shows that the bloom is off the rose. Sales dropped to a seasonally adjusted annual rate of 6.33 million. The latest snapshot of housing activity was weaker than analysts anticipated. Economists were forecasting the pace of sales to fall to 6.55 million. 'The housing sector is fragile,' said Lereah."

"Lereah said he still expects a 'soft landing' for the once high-flying housing sector. But he urged the Fed to leave interest rates alone and refrain from bumping them up again, as some analysts have said is a possibility."

"The housing sector's transition from a red-hot market to a cool one has important implications for the overall economy. Consumers who watched their homes rise rapidly in value over the last several years felt wealthy and more inclined to spend. They also borrowed against their homes, treating them like ATMs, to support their spending ways."