The existing home sales numbers are out. "Sales of existing homes managed to eke out a small increase in November but the price of homes sold fell for a fourth consecutive month, a real estate trade group reported Thursday. The median price for an existing home sold in November dropped to $218,000, down 3.1 percent from the price a year ago."

"It was the first time on record that sales prices compared to a year ago have fallen for four straight months."

"David Lereah, chief economist for the Realtors, predicted price declines would continue in December and probably for the early part of 2007. He said these were necessary adjustments that were luring buyers back into the market."

"Year-over-year declines in home prices are relatively rare and are seen as a significant sign of weakness in the real estate market. Until it occurred in August, there hadn't been such a drop in 11 years."

"The pace of home sales, coming in at an annual rate of 6.28 million for the month, was 10.7 percent below year-ago levels of 7.03 million units."

"'Mortgage interest rates are the lowest they’ve been since January,' said NAR President Pat Vredevoogd Combs. 'This is increasing buying power at the same time that sellers are showing a willingness to negotiate price and terms. Combined with a plentiful supply of homes on the market, there’s a window for buyers now with conditions that we haven’t seen prior to the beginning of the housing boom in 2001.'"

"Existing condominium and cooperative housing sales were 13.6 percent below the 876,000-unit pace in November 2005. Existing-home sales in the Northeast were 4.5 percent below November 2005. The median existing-home price in the Northeast was $269,000, down 2.2 percent from a year earlier."

"Existing-home sales in the West were 17.5 percent lower than a year earlier. The median price in the West was $351,000, down 0.8 percent from November 2005. Existing-home sales in the Midwest were 9.6 percent lower than November 2005. The median price in the Midwest was $165,000, which is 3.5 percent below a year ago."

"Existing-home sales in the South 10.2 percent below a year ago. The median price in the South was $179,000, down 3.2 percent from November 2005."

"Builders sold new homes at a faster rate last month than they did in October, the Commerce Department reported yesterday. When the numbers are not seasonally adjusted, the number of new homes sold in November, 72,000, was the lowest in almost four years. Inventories, a 7.7-month supply unadjusted, were the highest since December 1995."

"'There’s a relatively large adjustment factor here,' said Michael Carliner, an economist with the National Association of Home Builders. 'I wouldn’t read too much into those numbers.'"

"Sales of new homes are off 15.3 percent compared with a year earlier. 'Although the rebound in sales is consistent with the housing slowdown bottoming out, it seems too early to rejoice,' said economist Dimitry Fleming. 'Supply is still high.'"

"The sales data from the last year is more sobering. The Northeast was hit particularly hard; sales fell 42.4 percent from a year ago. Sales in the South declined 19.2 percent, and they fell 9 percent in the West."

"Permits for new home construction fell in November, the 10th consecutive decline, to a nine-year low, the Commerce Department said last week. Yesterday's report on new homes showed the number of homes completed and waiting to be sold rose 51 percent to a record 169,000 in November from the same month last year."

"Homeowners took a net $379.8 billion out of home equity at an annual rate last quarter, down 56 percent from the record reached a year earlier and the least since the fourth quarter of 2003, according to calculations by Fed economists. 'The weakness in housing will continue to be a drag on overall economic activity into the first half of next year,' Fed Bank of Richmond President Jeffrey Lacker said."

"None of the bulls seem to have a good answer to the facts being laid out by David Rosenberg, the chief economist for North America at Merrill Lynch. Rosenberg's contention is that when you take a close look at homes for sale, including those being completed and those under construction, the glut in supply seems likely to get worse, not better."

"Rosenberg notes that in addition to the record 4.3 million residential units for sale as of October, there were 1.95 million home completions, the 12th-highest month since 1979. Units under construction were through the roof as well."

"Rather than seeing supply dwindle and prices start to firm up in early 2007, Rosenberg says 'it could be a year before the reduction in starts begins to put a meaningful dent into the inventory backlog.'"

"According to John Mauldin, even the current projection of housing sales may be overstated and thus the existing supply of homes greater than what is reported in the official data. The reason is that the Census Bureau fails to account for cancellations in home sales contracts. Cancellations ran as high as 40 percent for some major homebuilding firms last quarter."