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Existing Home Sales: Sales Fall Sharply

August 24, 2017
Bottom Line: Home sales fell sharply in July, missing expectations for a modest rebound. Tight supply conditions are continuing to keep a lid on home sales as inventories of homes available for sale fell again. That said, median sales prices fell for the first time in 6 months -- while one month's data doesn't suggest a turn in the trend, prices bear watching going forward for any signs of waning demand. For now, the loss of momentum in home sales has been due to tight supply.

Existing Home Sales FELL by 1.3% in July to 5.44 million, compared with market expectations for an increase to 5.55 million. The prior month was revised down from 5.52 to 5.51 million. Home re-sales are now just 2.1% ABOVE their year ago level but are still 25.0% BELOW their September 2005 record high.

  • 41.1% of single family homes sold were priced in between 100k to 250k and 35.1% of single family homes sold were priced in between 250k to 500k.
  • Single family home sales are down 2.7% year-over-year for prices in between 100k to 250k and are up 7.8% for prices in between 250k to 500k.

The Inventory of Homes Available for Sale FELL by 1.0% to 1,920k and are now 9.0% BELOW their year ago level. Because inventories declined while sales declined, the Months Supply ROSE slightly to 4.2 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 4.9% ABOVE their year ago levels while median home prices are 6.2% ABOVE their year ago levels.