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Existing Home Sales: Break 7-month Streak Of Misses, But Trend Lower

November 21, 2018
Bottom Line: Existing home sales rebounded modestly more than expected in October, but the trend remains lower. Affordability remains a major issue for home sales with higher mortgage rates and continued home price appreciation. Home re-sales have averaged 5.23 million over the past 3 months, and 5.31 million over the past 6 months, sharply below the 12-month pace of 5.42 million and the 5.54 million pace of 2017.

Existing Home Sales ROSE by 1.4% in October to 5.22 million, compared with market expectations for an increase to 5.20 million. There were no revisions to prior data.

Home re-sales are now 5.1% BELOW their year ago level and are 28.0% BELOW their September 2005 record high.

The Inventory of Homes Available for Sale FELL by 1.6% to 1,850k but are still 2.8% ABOVE their year ago level. Because inventories declined while sales increased, the Months Supply FELL to 4.3 months from 4.4 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 2.3% ABOVE their year ago levels while median home prices are 3.8% ABOVE their year ago levels.