Economic data out of the U.S. Tuesday painted a mixed picture of recovery, with sales of previously owned homes slipping more than expected in October but revised numbers showing the overall economy grew faster during the summer than first thought.

The National Association of Realtors said existing homes sales dipped 2.2 per cent last month to a seasonally adjusted annual rate of 4.43 million units. Economists had predicted a drop of 1.1 per cent.

Sales of existing homes in the United States dipped 2.2 per cent in October. (Bill Sikes/Associated Press)

The American housing market continued to battle tough economic conditions, including high unemployment and tight credit.

The median price was $170,500, down 0.9 per cent from a year ago, as prices continue to be depressed by weak sales conditions and a huge overhang of unsold homes.

Sales had plunged to the slowest pace in 15 years in July and then posted gains in August and September before slipping back in October.

Sales in October were 38.9 per cent below their peak of 7.25 million units set in September 2005 during the height of the housing boom.

Revised GDP up

At the same time, the U.S. Commerce Department reported that gross domestic product grew slightly faster last summer than originally estimated, because of stronger spending by U.S. shoppers and improved overseas sales of American goods.

The economy expanded at a 2.5 per cent annual rate in the three-month quarter ending in September, an improvement on the two per cent pace initially estimated last month.

The U.S. economy slowed sharply in the spring, advancing at just 1.7 per cent.

Still, the economy would need to grow at least twice as fast as it did in the third quarter to make a dent in the 9.6 per cent unemployment rate.

That's why the U.S. Federal Reserve on Nov. 3 announced a second round of stimulus, aimed at buying $600 billion US worth of government bonds, which should keep interest rates low.

The intention is to encourage Americans to spend more by making loans cheaper and by boosting stock prices, and improving their sense of personal wealth.

With files from The Associated Press