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Economy in Brief

U.S. Existing Home Sales Rise While Prices Inch Up
by Tom Moeller   December 22, 2010

The National Association of Realtors reported that November sales of existing homes rose 5.6% to 4.680M following an unrevised 2.2% October decline. November sales fell short of Consensus expectations for 4.74M but for the quarter sales rose 9.4% from Q2 Total sales include sales of condos and co-ops. Sales of existing single-family homes alone rose 6.7% (-27.3% y/y) from October to 4.15M. (These data have a longer history than the total sales series.) Sales of condos and co-ops fell 1.9% m/m and remained down by one-third from last year.

The median price of all existing homes ticked up 0.1% m/m to $170,600 after four consecutive monthly declines. Though prices remained off one- quarter from the 2007 peak, they have risen 3.6% from the February low. The price of a single-family home slipped 0.1% last month to $171,300 (+1.2% y/y). Earlier price weakness sharply raised home affordability by more than two-thirds from the 2006 low. Also of help was a drop in the monthly mortgage to a new low of 4.62% during October. The median family income for existing home buyers was $62,141 and mortgage payments amounted to 13.6% of that total.

The number of unsold homes (single-family & co-ops) for sale fell in November to 3.710 mil. but were up 5.4% y/y. At the current sales rate, the months' supply of homes on the market fell m/m to 9.5, well off the record high of 12.5. For single-family homes, the inventory also fell m/m to a 9.3 months' supply.

The data on existing home sales, prices and affordability can be found in Haver's USECON database. The regional price, affordability and inventory data is available in the REALTOR database.

The Effect of Falling Home Prices on Small Business Borrowing from the Federal Reserve Bank of Cleveland is available here.

Existing Home Sales(Thous, SAAR) Nov. Oct. Sept. Y/Y% 2009 2008 2007
Total 4,680 4,430 4,530 -27.9 5,160 4,893 5,674
 Northeast 770 750 760 -33.0 863 845 1,010
 Midwest 1,000 940 950 -35.1 1,166 1,130 1,331
 South 1,760 1,710 1,770 -26.1 1,913 1,860 2,243
 West 1,150 1,030 1,050 -19.0 1,216 1,064 1,095
Single-Family Sales 4,150 3,890 3,970 -27.3 4,573 4,341 4,960
Median Price, Total, $(NSA) 170,600 170,400 171,500 0.4 172,742 197,233 216,633
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