HOME sales in the United States probably teetered near a 10-year low, property values dropped and consumer spending cooled, signaling the economy has taken another turn for the worse, reports this week are projected to show.

A total of 5.435 million new and existing homes were purchased in July at an annual pace, according to the median estimate of economists polled by Bloomberg News. June's 5.39-million rate was the weakest since at least 1999. Spending probably rose 0.3 percent in July, half the prior month's gain.

The real estate recession will persist into next year as stricter lending rules and higher borrowing costs shackle demand. At the same time, equity is disappearing as home prices fall, and wages aren't keeping up with inflation, depriving Americans of the means to maintain spending, the biggest part of the economy.

'The economy is going down a shaky path,' said Maxwell Clarke, chief US economist at IDEAGlobal Inc in New York. 'We're not going to see a rebound in housing any time soon. Consumers are living hand to mouth, and the outlook for spending is very weak.'

Purchases of new houses dropped 0.9 percent to an annual rate of 525,000, according to the median estimate of economists polled ahead of a Commerce Department report tomorrow. March's 513,000 pace was the lowest since 1991.

Resales of existing homes, compiled from closings and reflecting contracts signed weeks or months earlier, will be reported by the National Association of Realtors today. Purchases gained 1 percent to a 4.91-million annual rate, staying near June's 10-year low, the survey median showed.

While sales of previously owned homes account for about 85 percent of the market, new-home purchases are considered a timelier indicator because they are based on contract signings.

The slump in demand is keeping property values under pressure. The S&P/Case-Shiller index of home prices in 20 metropolitan areas probably fell in June, the survey showed. The figures, due out tomorrow, would extend a string of declines that began in August 2006.

Consumers, after getting a temporary lift from the government's tax rebates earlier this year, are focusing on buying necessities and hunting for bargains following the jump in food and fuel costs.

Commerce Department figures on Friday will underscore the dimming outlook for consumer spending, according to the Bloomberg News survey.