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Economy in Brief

U.S. Existing Home Sales Jump to Highest Level Since 2007; Prices Remain Firm
by Tom Moeller  August 21, 2013

Last month was a busy one for home sellers. Sales of existing homes jumped 6.5% during July (17.2% y/y) to 5.390 mil. units (AR), according to the National Association of Realtors. The June figure was revised down slightly to 5.390. The latest figure was the highest since March 2007. Consensus expectations had been for 5.150 mil. sales. Sales of existing single-family homes alone increased 6.3% to 4.760 mil. (16.4% y/y). These data have a longer history than the total sales series. Sales of condos and co-ops gained 8.6% to 0.630 mil. (23.5% y/y).

Sales firmed across the country. The greatest m/m rise was logged in the Northeast sales with a 12.7% increase (20.7% y/y) to .710 mil. Sales in the West rose 6.6% (13.2% y/y) to 1.290 mil. while sales in the Midwest gained 5.8% to 1.280 mil. (20.8% y/y). Sales in the South followed with a 5.0% increase (16.6% y/y) to 2.110 mil.

The supply of homes on the market held at 5.1 months of sales and remained down from a high of 11.9 months in July of 2010. The actual number of homes on the market fell 5.1% y/y last month. That added to a 21.1% decline during all of last year and a 23.2% drop in 2011.

The median price of an existing home slipped 0.2% in July to $213,500 but remained up 13.7% y/y. It remained near the highest price reading since June 2008. The peak was $230,300 in July 2006.

Reported earlier this month, the June composite index of home price affordability declined 6.2% (-8.5% y/y) to its lowest level since July 2010. The decline was due to the 0.3% price slip (13.5%) coupled with a rise in the average mortgage rate to 3.67%, up from the 3.43% December low.

The data on existing home sales, prices and affordability can be found in Haver's USECON database. The regional price, affordability and inventory data are available in the REALTOR database. The expectations figure is from the Action Economics survey, reported in the AS1REPNA database.

The Price of Stock and Bond Risk in Recoveries from the Federal Reserve Bank of San Francisco can be found here.

Existing Home Sales (SAAR, 000s) Jul Jun May Y/Y % 2012 2011 2010
Total 5,390 5,060 5,140 17.2 4,661 4,278 4,183
Northeast 710 630 640 20.3 596 543 563
Midwest 1,280 1,210 1,210 20.8 1067 918 909
South 2,110 2,010 2,060 16.6 1,833 1,683 1,626
West 1,290 1,210 1,230 13.2 1,165 1,133 1,084
Single-Family Sales 4,760 4,480 4,500 16.4 4,130 3,793 3,705
Median Price Total ($, NSA) 213,500 214,000 203,100 13.7 175,442 164,542 172,442
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