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Economy in Brief

U.S. Existing Home Sales Improve to Seven-Month High and Pull Prices Higher
by Tom Moeller  June 23, 2014

Earlier improvement in home sales picked up steam last month. Sales of existing single-family homes in May jumped 4.9% (-5.0% y/y) to 4.890 million (AR) from 4.660 million in April, earlier reported as 4.650 million. Despite the increase, however, sales remained 9.1% below the peak reached last July. The latest level exceeded expectations for 4.73 million sales in the Action Economics Forecast Survey. Sales of single-family homes improved 5.7% (-5.7% y/y) to 4.300 million. Sales of condos and co-ops were unchanged, both m/m and y/y.

Sales were strongest in the Midwest where they rose 8.7% (-7.4% y/y) followed by a 5.7% (-0.5% y/y) increase in the South. In the Northeast, sales gained 3.3% (-3.1% y/y) and sales in the West nudged 0.9% higher (-1.4% y/y).

The median sales price of an existing single-family home increased 5.9% to $213,400 last month (5.1% y/y) and roughly equaled the peak reached eleven months earlier. Prices remained 7.4% lower than the all-time peak in July 2006.

Home affordability during April declined 2.3% (-10.3% y/y) as higher home prices offset the stability of mortgage rates at 4.39%.

The inventory of unsold homes rose 2.2% last month (6.0% y/y) to 2.280 million but remained 43.6% below the 2007 peak. The supply of unsold homes slipped m/m to 5.6 months. That compares to an 11.9 month supply in July of 2010.

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.

Existing Home Sales (SAAR, 000s) May Apr Mar Y/Y % 2013 2012 2011
Total 4,890 4,660 4,590 -5.0 5,073 4,659 4,277
Northeast 620 600 600 -3.1 659 597 543
Midwest 1,130 1,040 1,040 -7.4 1,193 1,064 917
South 2,050 1,940 1,920 -0.5 2,032 1,834 1,683
West 1,090 1,080 1,030 -11.4 1,190 1,164 1,133
Single-Family Sales 4,300 4,070 4,040 -5.7 4,471 4,128 3,792
Median Price Total ($, NSA) 213,400 201,500 196,700 5.1 195,667 175,442 164,542
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