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Economy in Brief

U.S. Existing Home Sales Edge Higher in January and Supply Tightens
by Tom Moeller  February 19, 2021

• Existing home sales near 2006 high.

• Inventory of unsold homes continues to fall sharply.

• Sales remain mixed regionally.

The market for previously owned homes remains strong. The National Association of Realtors (NAR) reported that sales of existing homes rose 0.6% (23.7% y/y) during January to 6.690 million (SAAR) from 6.650 million in December, revised from 6.760 million. November sales also were revised lower to 6.590 million from 6.710 million. The Action Economics Forecast Survey expected January sales of 6.65 million. Data are compiled when existing home sales close.

Housing supply continues to decline. The number of homes on the market fell 1.9% (NSA) last month (-25.7% y/y) to a record low of 1.04 million units. (The figures date back to January 1999.) The months' supply of homes on the market remained at the record low of 1.9 months, below a recent high of 4.6 months in May and 10.4 months averaged during all of 2008.

Sales were mixed last month across the country. In the South, sales increased 3.2% (25.1% y/y) to 2.940 million units after a 1.1% December rise. Sales in the Midwest gained 1.9% (22.7% y/y) to 1.570 million after improving 0.7% in December. To the downside, exiting home sales in the West weakened 4.4% (+21.3% y/y) to 1.310 million after slipping 0.7% in December. In the Northeast, sales were off 2.2% (+24.3% y/y) to 870,000 units after a 3.5% December rise.

The median price of an existing home fell 1.7% (+14.1% y/y) to $303,900, the lowest price in six months. The median home price in the West fell 1.3% (+16.1% y/y) to $461,800. In the Northeast, prices eased 0.1% (+15.8% y/y) to $361,400. The median home price in the South fell 2.0% (+14.6% y/y) to $263,300. In the Midwest, prices fell 2.4% (+14.7% y/y) to $227,800. The average sales price of all existing homes weakened 1.3% last month (+11.5% y/y) to $337,700. The price data are not seasonally adjusted.

Sales of existing single-family homes improved 0.2% (23.0% y/y) to 5.930 million units after gaining 0.7% during December. Sales of condos and co-ops rose 4.1% (28.8% y/y) to 760,000 units after December's 2.8% increase. The increase left sales at the highest level since December 2006.

The data on existing home sales, prices and affordability are compiled by the National Association of Realtors. The data trace back to February 1968. Total sales and price data and regional sales can be found in Haver's USECON database. Regional price and affordability data and national inventory data are available in the REALTOR database. The expectations figure is from the Action Economics Forecast Survey, reported in the AS1REPNA database.

Future Output Loss from COVID-Induced School Closures from the Federal Reserve Bank of San Francisco is available here.

Existing Home Sales (SAAR, 000s) Jan Dec Nov Jan Y/Y % 2020 2019 2018
Total Sales 6,690 6,650 6,590 23.7 5,658 5,330 5,334
   Northeast 870 890 860 24.3 705 687 687
   Midwest 1,570 1,540 1,530 22.7 1,339 1,248 1,264
   South 2,940 2,850 2,820 25.1 2,458 2,281 2,245
   West 1,310 1,370 1,380 21.3 1,156 1,115 1,138
 Single-Family Sales 5,930 5,920 5,880 23.0 5,076 4,754 4,737
Median Price Total ($, NSA) 303,900 309,200 310,800 14.1 295,217 269,783 257,267
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