The nation's home prices rose at the slowest pace in a decade according to a government report. Prices for single-family houses rose an average 4.3 percent from a year earlier, the smallest gain since the 4.1 percent increase in the third quarter of 1997. During the first three months of 2007 prices gained 0.5 percent, the slowest quarterly growth since the 0.4 percent increase in the third quarter of 1996. The housing slowdown weighs heavily on economic activity as the growth of the economy grew slowly to 0.6 percent last quarter.
The Fed voted unanimously to leave the benchmark U.S. lending rate at 5.25 percent for a seventh consecutive meeting with expectations of the same vote in June.
New-home sales, accounting for 15 percent of residential transactions, surged 16 percent in April as the median price dropped 11 percent.
Freddie Mac reports the average rate for a 30 year fixed mortgage this week is 6.42 percent with the probability of 6.2 percent for an annual average.