Existing Home Sales: Lower Again

Bottom Line: Existing home sales fell again in August, countering expectations for a small rebound. The medium-term trend in sales was lower again, even before much of the recent increase in mortgage rates. The long-term trend was firmly to the downside. Most existing homeowners with low mortgage rates remain reluctant to move and pay off low-rate mortgages. And after a modest increase, inventory levels have plateaued at historically low levels. Overall, the existing home sales market remains in a downtrend. New homes, meanwhile, have been stronger amid demographic-led demand for housing -- but even that market has started to show cracks again with higher mortgage rates.