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Existing Home Sales: Another Slow Month Started 2018

February 21, 2018

Bottom Line: Existing home sales fell for the second month in a row, dropping to a 5.38 million seasonally adjusted annual pace in January, below expectations for 5.6 million. Home re-sales have averaged 5.55 million over the past 3 months and 5.49 million over the past 6 months, suggesting a mixed trend. Inventories of homes available for sale climbed modestly; but the trend in months’ supply rose slightly. On a year-over-year basis, prices are still modestly higher.

Existing Home Sales FELL by 3.2% in January to 5.38 million, compared with market expectations for an increase to 5.60 million. The prior month was revised down from 5.57 to 5.56 million.

Home re-sales are now 4.8% BELOW their year ago level and are 25.8% BELOW their September 2005 record high.

The Inventory of Homes Available for Sale ROSE by 4.1% to 1,520k but are still 9.5% BELOW their year ago level. Because inventories increased while sales declined, the Months Supply ROSE to 3.4 months from 3.2 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 4.7% ABOVE their year ago levels while median home prices are 5.8% ABOVE their year ago levels.

Article by Contingent Macro Advisors