Existing Home Sales: Holding Below 5 million unit mark

Bottom Line: Existing home sales fell again in January, starting 2019 on the decelerating trend that ended 2018 with sales now firmly below 5 million units annually. While there were upward revisions to December data, November data was revised down, more than offsetting the December boost. Across both single-family and multifamily the trend is firmly towards deceleration with the last 3-months averaging just 5.05 million units annualized, sharply below the 5.34 million pace for all of 2018. Finally, months supply rose, but overall inventory levels remained tight, suggesting the slowdown is about affordability more than supply. Existing Home Sales FELL by 1.2% in January to 4.94 million, compared with market expectations for in line to 5.00 million. The prior month was revised up from 4.99 to 5.00 million. Home re-sales are now 8.5% BELOW their year ago level and are 31.9% BELOW their September 2005 record high. The Inventory of Homes Available for Sale ROSE by 3.9% to 1,590k and are now 4.6% ABOVE their year ago level. Because inventories increased while sales declined, the Months Supply ROSE to 3.9 months from 3.7 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 1.5% ABOVE their year ago levels while median home prices are 2.8% ABOVE their year ago levels.