US home resales have fallen more than expected in December as the supply of houses on the market has dropped to levels last seen in 1999, but the housing market recovery remains intact against the backdrop of a tightening labour market.

The National Association of Realtors on Tuesday said existing home sales decreased 2.8 per cent to a seasonally adjusted annual rate of 5.49 million units in December. In addition to the lack of properties to purchase, rising home prices and mortgage rates also likely sidelined some buyers. The drop in…