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The weaker survey of service industries account for about 90% of the economy and include retail, utilities, health care and construction.
While home price growth is cooling, it's been outpacing gains in worker pay for several years.
Financial experts expect affordability to continue to weigh on the housing market as long as price growth exceeds wage growth.
Economists appear divided about the path of interest rates going forward.
It's the latest in a spate of reports indicating housing is in a broad slowdown.
U.S. purchases of new homes fall more than estimated in September to the weakest pace since December 2016.
Non-revolving lending by the federal government, which is mainly for student loans, increased by $20.2 billion.
This report should keep the Feds on track to continue raising rates.
The biggest concern is rising rates in conjunction with higher prices.
Economic experts believe many potential home buyers are reluctant to make this financial commitment.