Existing Home Sales: Sales Drop, Inventories Fell, Prices Climb

December 22, 2015
Existing Home Sales FELL by 10.5% in November to 4.76 million, the lowest level since April 2014, compared with market expectations for an increase to 5.35 million. The prior month was revised down from 5.36 to 5.32 million. Home re-sales are now 3.8% BELOW their year ago level and 34.3% BELOW their September 2005 record high. The year-over-year rate declined for the first time after 13 consecutive months of positive growth. The Inventory of Homes Available for Sale FELL by 3.3% to 2,040k and are now 1.9% BELOW their year ago level. Foreclosures and short sales accounted for 9% of November sales, up from 6% in October and unchanged compared to year ago. Because sales declined more than inventories, the Months Supply ROSE to 5.1 months from 4.8 months. This is still well BELOW its July 2010 cyclical peak of 12.4 (which was its highest level since 1982) and even BELOW the 6 month level that is considered 'normal'. Home Prices ROSE compared to their year ago levels. Average home prices are 4.0% ABOVE their year ago levels while median home prices are 6.3% ABOVE their year ago levels. There has been a modest increase in home prices this year. Bottom Line: Existing home sales fell sharply in November to their lowest level since April 2014. Home re-sales have averaged 5.21 million over the past 3 months and 5.33 million over the past 6 months, highlighting soft housing market before the Fed hike. Inventories of homes available for sale dropped modestly; and the trend in months’ supply rose slightly. On a year-over-year basis, prices are still modestly higher
Article by contingentmacro