Demand for previously owned homes in the United States slid more than expected in September amid continued problems in the mortgage market, with single-family sales hitting their lowest sales pace in nearly 10 years.

Overall home resales declined to a 5.04 million annual rate, an 8% decrease from August’s downwardly revised 5.48 million annual pace, the U.S. National Association of Realtors said today.

The 5.04 million pace is the lowest since the association started accounting for combined single family and condo sales in 1999.

Based on single-family sales of 4.38 million, the September figures are the weakest since January 1998.

“The credit freeze in August definitely impacted sales in September, particularly the jumbo [loan] side, so we have seen a large sales decline in the upper end of the market,” NAR senior economist Lawrence Yun said in a release.

The median home price was US$211,700 in September, down 4.2% from US$220,900 in September 2006. The median price in August this year was US$224,400.

Yun said conditions in the jumbo loan market have improved, so he still expects 2007 to rank as the fifth-best year in terms of existing home sales. Prices are expected to ease about 1.5% from record high of last year of US$221,900.

Inventories of homes rose 0.4% at the end of September to 4.4 million available for sale, which represented a 10.5-month supply at the current sales pace. There was a 9.6 month supply at the end of August, revised down from a previously estimated 10.0 months.

Existing-home sales tumbled in all regions. Sales dropped 7% in the Midwest, 10% in the Northeast, 9.9% in the West, and 6% in the South.