Home loans are also harder to come by. Many lenders are requiring 20 percent down payments and strong credit scores to qualify.
The pace of sales for previously occupied homes is slightly above last year's 4.91 million sold, the fewest since 1997. In a healthy economy, Americans would buy roughly 6 million homes each year.
In August, sales of new homes fell for a fourth straight month. This year is shaping up to be the worst for new-home sales on records dating to 1963.
Even so, homes are the most affordable they've been in decades. Mortgage rates are at six-decade lows. Prices in some metro areas have been cut in half. Still, sales in most areas remain weak.
The number of people signing home contracts rose in both May and June. But those increases didn't make up for a huge drop-off in April, when signings fell more than 11 percent. Over the past two months, signings have declined 2.5 percent.
Contract signings fell across most of the country. July's index fell 5.8 percent in the Northeast, 3.7 percent in the Midwest and 2.4 percent in the West. It rose 2.6 percent in the South.
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This 966-square-foot gable-roofed box offers two bedrooms and one bathroom. Also part of the deal is a "very functional kitchen," according to the description. It "really wouldn't take much to get this home move-in ready." View the listing -- which has 11 photos -- here.
The facade -- which includes a covered brick porch -- is presentable and the space, at 2,000 square feet, is generous. So how the heck does this home in South Bend, Ind., cost only 10 large? Well, the interior could use some work, as the listing photos show. But the other specs on this house still make it quite a deal.