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Economy in Brief

U.S. Existing Home Sales Improve As Prices Fall Sharply
by Tom Moeller  October 21, 2014

Sales of existing single-family homes rose 2.4% to 5.170 million (AR, -1.7%) during September from an unrevised 5.050 million in August. Sales were 3.9% below the peak reached last July. The latest level beat expectations for 5.10 million sales in the Action Economics Forecast Survey. Sales of single-family homes improved 2.0% (-1.9% y/y) to 4.560 million. Sales of condos and co-ops increased 5.2% (0.0% y/y) to 0.610 million.

The median sales price of an existing single-family home declined 4.0% to $209,700 last month (+5.6% y/y). It was the lowest price since April. Prices were 9.0% below the all-time peak in July 2006.

Sales in the West rebounded 7.1% (-4.0% y/y) to the highest level in twelve months. In the South, sales recovered 5.0% (1.4% y/y) and matched the high for the economic expansion. Sales in the Northeast improved 1.5% (-1.4% y/y) to the highest level since last October. Countering these gains was a 5.6% sales decline (-4.9% y/y) in the Midwest. It was the lowest level since May.

During August, home affordability improved 1.2% (-1.4% y/y) as monthly mortgage payments slipped to 15.9% of median family income, down from its recent high of 16.1%. Mortgage rates averaged 4.24%, down from the January high of 4.54%.

The inventory of unsold homes rose 6.0% y/y to 2.300 million but remained 43% below the 2007 peak. The supply of unsold homes slipped to 5.3 months. That compares to an 11.9 month peak 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) Sep Aug Jul Y/Y % 2013 2012 2011
Total 5,170 5,050 5,140 -1.7 5,073 4,659 4,277
   Northeast 680 670 640 -1.4 659 597 543
   Midwest 1,170 1,240 1,210 -4.9 1,193 1,064 917
   South 2,120 2,020 2,120 1.4 2,032 1,834 1,683
   West 1,200 1,120 1,170 -4.0 1,190 1,164 1,133
Single-Family Sales 4,560 4,470 4,540 -1.9 4,471 4,128 3,792
Median Price Total ($, NSA) 209,700 218,400 221,600 5.6 195,667 175,442 164,542
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