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Economy in Brief

U.S. Existing Home Sales Continue Improvement
by Carol Stone  November 20, 2014

Sales of existing single-family homes rose 1.5% to 5.260 million (AR, +2.5% y/y) in October from 5.180 million in September, a slight revision from 5.170 million reported before. Sales were 2.2% below their recent high in July 2013. The latest volume was well ahead of consensus expectations for 5.15 million sales in the Action Economics Forecast Survey. Sales of single-family homes were up 1.3% (+2.9% y/y) to 4.630 million. Sales of condos and co-ops increased 3.3% (0.0% y/y) to 0.630 million.

The median sales price of an existing home edged down 0.4% to $208,300 last month. While this was the fourth consecutive monthly decline, it appears that move is seasonal, and the median price is still 5.4% above a year ago.

By region, October sales increased everywhere except the West; there they almost reversed their September jump of 7.1%, as they fell 5.0% and were 3.9% below a year ago. The Midwest had the opposite of this pattern, as sales there rebounded 5.1% in October after a 4.8% decline in September. They were 2.5% above the year-earlier amount. Sales in the Northeast were up 2.9% in October to a level 4.1% ahead of October 2013. And sales in the South gained 2.8% in the month, up 3.3% from the year earlier, and at 2.170 million, were the highest in that region since July 2007. Notably, as seen here, all regions except the West moved to a positive year-on-year comparison in October.

During September, home affordability improved 4.5% (-0.9% y/y) as monthly mortgage payments slipped to 15.1% of median family income, down from their recent high of 16.1%. Mortgage rates edged down to 4.21% from 4.24% in September and the recent high of 4.54% in January.

The inventory of unsold homes was up 5.2% y/y to 2.220 million. Compared to sales, this supply of unsold homes fell to 5.1 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) Oct Sep Aug Y/Y % 2013 2012 2011
Total 5,260 5,180 5,050 2.5 5,073 4,659 4,277
   Northeast 710 690 670 4.4 659 597 543
   Midwest 1,240 1,180 1,240 2.5 1,193 1,064 917
   South 2,170 2,110 2,020 5.3 2,032 1,834 1,683
   West 1,140 1,200 1,120 -3.4 1,190 1,164 1,133
Single-Family Sales 4,630 4,570 4,470 2.9 4,471 4,128 3,792
Median Price Total ($, NSA) 208,300 209,700 218,400 5.6 195,667 175,442 164,542
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