Demand for previously owned homes in the United States tumbled in August to the lowest level in five years as mortgage market troubles hurt sales.

Separately, U.S. consumer confidence fell to a nearly two-year low in September, weighed down by a softening labor market and worries over volatility in financial markets and a weaker dollar, according to a report today from the Conference Board.

Home resales fell to a 5.50 million annual rate, a 4.3% decrease from July’s unrevised 5.75 million annual pace, the U.S. National Association of Realtors said today.

The August resales level was in line with Wall Street expectations. It was the lowest pace since 5.36 million in August 2002. “The credit market freeze in August no doubt contributed to the sales decline,” NAR senior economist Lawrence Yun said in a release.

The median home price was YS$224,500 in August, up 0.2% fromUS $224,000 in August 2006. The median price in July this year was US$228,700.
Consumer Confidence Declines

Meanwhile, the U.S. Conference Board’s consumer confidence index slid to 99.8 from 105.6 in August, leaving it at its lowest mark since November 2005’s 98.3.

Consumers’ assessments of present-day conditions were also lower, dragging this index down to 121.7 in September from 130.1 in August.

The index measuring expectations for business conditions over the next six months also fell, to 85.2 in September from August’s 89.2.

“Weaker business conditions combined with a less favorable job market continue to cast a cloud over consumers and heighten their sense of uncertainty and concern,” said Lynn Franco, director of the Conference Board Consumer Research Center.