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Economy in Brief

U.S. Existing Home Sales Increase to Ten-Month High
by Tom Moeller  August 21, 2014

Sales of existing single-family homes strengthened 2.4% to 5.150 million (AR) during July from 5.030 million in June, last month reported as 5.040 million. Sales were at the highest level since last September, but nevertheless remained 4.3% below the peak reached last July. The latest level exceeded expectations for 5.010 million sales in the Action Economics Forecast Survey. Sales of single-family homes improved 2.7% (-4.2% y/y) to 4.550 million. Sales of condos and co-ops were unchanged m/m (-4.8% y/y) at 0.600 million.

Sales were strongest in the South where they increased 3.4% (0.5% y/y) and in the West where they rose 2.6% (-8.6% y/y). In the Midwest sales rose 1.7% (-4.7% y/y) but in the Northeast sales remained unchanged (-9.9% y/y).

The median sales price of an existing single-family home improved 0.4% to $222,900 last month (4.9% y/y). Prices remained 3.3% lower than the all-time peak in July 2006.

During June, home affordability declined 4.1% (-9.0% y/y) as higher home prices offset the fall in mortgage rates to 4.23%. Monthly mortgage payments amounted to 16.3% of median family income.

Improved sales and higher prices are prompting an increased number of homes for sale. The inventory of unsold homes rose 3.5% last month (5.8% y/y) to 2.370 million but remained 41.3% below the 2007 peak. The supply of unsold homes held at 5.5 months for the third straight month. 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.

The minutes to the latest FOMC meeting can be found here.

Existing Home Sales (SAAR, 000s) Jul Jun May Y/Y % 2013 2012 2011
Total 5,150 5,030 4,910 -4.3 5,073 4,659 4,277
Northeast 640 640 620 -9.9 659 597 543
Midwest 1,220 1,200 1,130 -4.7 1,193 1,064 917
South 2,120 2,050 2,050 0.5 2,032 1,834 1,683
West 1,170 1,140 1,110 -8.6 1,190 1,164 1,133
Single-Family Sales 4,550 4,430 4,320 -4.2 4,471 4,128 3,792
Median Price Total ($, NSA) 222,900 222,000 212,000 4.9 195,667 175,442 164,542
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