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US sales of existing homes jump 20% after a 3-month slump

BALTIMORE — Americans stepped up their home purchases in June by a robust 20.7% after the pandemic had caused sales to crater in the prior three months. But the housing market could struggle to rebound further in the face of the resurgent viral outbreak and a shrinking supply of homes for sale.

Sales of existing homes rose last month to a seasonally adjusted annual rate of 4.72 million, the National Association of Realtors said Wednesday. Despite the sharp gain, purchases are still down 11.3% from a year ago, when homes had sold at an annual pace of 5.32 million. And Lawerence Yun, the Realtors’ chief economist, noted that sales remain roughly 20% below their pre-pandemic levels.

At the same time, housing has managed to avoid a deeper slump from the severe recession caused by the coronavirus. Demand has remained strong among buyers who have managed to weather the downturn, while record-low mortgage rates have helped sustain affordability.

“Buyers are out in force, but new listings remain the key to housing’s recovery,” said Danielle Hale, chief economist at Realtor.com. “More sellers are needed before we’ll see year over year gains in home sales.”

The number of property listings has plunged 18.2% from a year ago to 1.57 million. It’s the 13th straight month of shrinking supply on an annual basis. The shortage of homes makes it unlikely that the housing industry can significantly boost the overall economy.

Home buyers typically purchase new furniture and fix up older properties. Their ability to deliver such a spending boost is constrained if they can’t find an available house. The limited supply is also forcing up prices just when many Americans are struggling with financial uncertainty because of the recession.

The combination of steady demand and falling mortgage rates has helped fuel a 3.5% rise in the median price of an existing home over the past year to $295,300.

Home sales rose in the Northeast, Midwest, South and West last month. But the increases were most dramatic in the West, with a 32% gain and the South with a 26% gain.

Josh Boak, The Associated Press

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Kuwait emir, 91, to go to US for medical care after surgery

DUBAI, United Arab Emirates — Kuwait says its 91-year-old ruling emir, who recently underwent surgery, will travel to the U.S. for further medical care.

That’s according to a report Wednesday night by the state-run KUNA news agency.

Kuwait has yet to elaborate what required Sheikh Sabah Al Ahmad Al Sabah to seek a previously unannounced medical treatment beginning Saturday. However, Sheikh Sabah’s sudden surgery could inspire a renewed power struggle within Kuwait’s ruling family.

Sheikh Sabah will leave for the U.S. on Thursday morning.

The Associated Press

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2 more ex-Wirecard managers arrested, ex-CEO back in custody

BERLIN — Two more former executives at bankrupt German payment company Wirecard were arrested on Wednesday in the fraud scandal that brought down the one-time tech star and its former CEO was taken back into custody after the case against him was expanded, prosecutors said.

The two newly arrested ex-managers are the company’s chief financial officer until the end of 2017 and its former head of accounting, Munich prosecutor Anne Leiding said. She identified them only as L. and von E. respectively, in keeping with German privacy rules.

The case against ex-CEO Markus Braun was expanded and a court ordered him kept in custody, Leiding said. Braun was first arrested last month on suspicion of market manipulation and falsifying financial results, and then released on bail. A fourth former executive, the head of a subsidiary in Dubai, was arrested in early July.

Wirecard filed for protection from creditors through an insolvency proceeding on June 25 after executives admitted that 1.9 billion euros ($2.2 billion) that had been represented as being held in trust accounts in the Philippines probably did not exist. The company said it is investigating the scope of its business handling payments through regional third parties, a major source of profits, and how that business was being conducted.

Leiding said prosecutors believe that the four suspects arrested, along with others, agreed in 2015 to inflate Wirecard’s balance sheet by faking income from business with so-called third-party acquirers, making it more attractive to potential investors.

“In reality, it was clear to the suspects by the end of 2015 at the latest that Wirecard was losing money overall with its actual business,” she told reporters. The suspects initiated talks that resulted in banks in Germany and Japan – along with other investors hoodwinked by the over-rosy annual accounts – providing some 3.2 billion euros in total, Leiding said. The moneyis probably lost now that the company is insolvent, she added.

Leiding wouldn’t break down the potential charges against the individual suspects, but said they include fraud, breach of trust, misrepresentation and market manipulation.

The Wirecard debacle has raised questions about the effectiveness of German financial regulation, and about who in the government knew what when. It has been viewed as a setback for the investment climate and attempts to promote the country as a base for financial services companies.

The Associated Press

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UK to open citizenship path to Hong Kongers from January

LONDON — Britain’s government announced Wednesday that it will open a new special pathway to obtaining U.K. citizenship for eligible Hong Kongers as of January, taking another step toward solidifying a policy denounced by China.

In a statement, the Home Office said holders of the British National Overseas passport and their immediate family members can move to the U.K. to work and study. The change to immigration rules was introduced after Beijing imposed a new, sweeping national security law on Hong Kong.

“Today’s announcement shows the U.K. is keeping its word: We will not look the other way on Hong Kong, and we will not duck our historic responsibilities to its people,” British Foreign Secretary Dominic Raab said.

Britain announced in early July it was extending residency rights for up to 3 million people eligible for the British National Overseas passport in Hong Kong, stressing that it would uphold its duty to the former British colony after the new law was imposed.

Eligible individuals from Hong Kong currently can come to the U.K. for six months without a visa. They will have the right to live and work in the country for five years. After that, they will be allowed to apply for settled status and then again for citizenship.

Those eligible can access the British job market at any skill level and without a salary threshold, but won’t have access to public funds.

The U.K. introduced a special, limited type of British nationality in the 1980s for people who were a “British dependent territories citizen by connection with Hong Kong.” The passports did not confer nationality or the automatic right to live and work in Britain, but entitled holders to consular assistance from U.K. diplomatic posts.

Britain handed over Hong Kong, its former colony, to Chinese rule in 1997 under a “One Country, Two Systems” framework that was supposed to guarantee the city a high degree of autonomy and Western-style civil liberties not seen on mainland China.

Sylvia Hui And Danica Kirka, The Associated Press

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