Existing Home Sales: Increased As Supply Fell in July

Bottom Line: Existing home sales rose modestly in July to their highest level since February. Home re-sales have averaged 5.36 million over the past 3 months and 5.33 million over the past 6 months, suggesting that the housing market is still improving modestly. Inventories of homes available for sale dropped modestly as the trend in months’ supply declined. Prices fell slightly after volatility in the last few months but mostly remain on a trend towards modestly slower home price gains. These July data suggest the summer selling season was moderate with overall activity slowly trending higher since 2018's adjustment to new tax policies. Existing Home Sales ROSE by 2.5% in July to 5.42 million, compared with market expectations for an increase to 5.40 million. The prior month was revised up from 5.27 to 5.29 million. Home re-sales are now 0.6% ABOVE their year ago level but are 25.2% BELOW their September 2005 record high. The Inventory of Homes Available for Sale FELL by 1.6% to 1,890k and are now 1.6% BELOW their year ago level. Because inventories declined while sales increased, the Months Supply FELL to 4.2 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 3.1% ABOVE their year ago levels while median home prices are 4.3% ABOVE their year ago levels.