Global| Oct 25 2010U.S. Existing Home Sales Improve As Prices Fall
by:Tom Moeller
|in:Economy in Brief
Summary
Price discounts seem to have buoyed home sales last month. The National Association of Realtors reported that sales of existing homes during September increased 10.0% to 4.53M following a little revised 7.3% August increase. September [...]
Price discounts seem to have buoyed home sales last month. The National
Association of Realtors reported that sales of existing homes during
September increased 10.0% to 4.53M following a little revised 7.3% August
increase. September sales were slightly better than
Consensus expectations for 4.30M. Total sales include sales of condos and
co-ops. Sales of existing single-family homes alone rose 10.0% (-19.5% y/y)
from August to 3.97M. (These data have a longer history than the total sales
series.) Sales of condos and co-ops rose 9.8% m/m but remained down 16.2%
from last year.
Lower prices may have helped prompt last month's sales improvement. The median price of all existing homes fell 3.3% m/m to $171,700, the third consecutive monthly decline. Though prices remained off one quarter from the 2007 peak, they have risen 4.3% from the February low. The price of a single-family home fell 3.1% to $172,600 (-1.9% y/y). Earlier price weakness sharply raised home affordability -- by two-thirds from the 2006 low, though very recent price improvement has stalled. The median family income for existing home buyers was $60,498, and mortgage payments amounted 14.9% of that total.
The number of unsold homes (single-family & co-ops) for sale slipped in September to 4.040 mil. but were up 8.9% y/y. At the current sales rate, the months' supply of homes on the market fell m/m to 10.7, just off the record high. For single-family homes, the inventory also fell m/m to a 10.2 months' supply.
The data on existing home sales, prices and affordability can be found in Haver's USECON database. The regional price, affordability and inventory data is available in the REALTOR database.
Fed Chairman Bernanke's opening remarks at today's Federal Reserve conference on Mortgage Foreclosures and the Future of Housing are available here.
| Existing Home Sales (Thous, SAAR) | September | August | July | Y/Y % | 2009 | 2008 | 2007 |
|---|---|---|---|---|---|---|---|
| Total | 4,530 | 4,120 | 3,840 | -19.1 | 5,160 | 4,893 | 5,674 |
| Northeast | 760 | 690 | 630 | -20.8 | 863 | 845 | 1,010 |
| Midwest | 950 | 830 | 800 | -26.4 | 1,166 | 1,130 | 1,331 |
| South | 1,770 | 1,600 | 1,540 | -14.9 | 1,913 | 1,860 | 2,243 |
| West | 1,050 | 1,000 | 870 | -16.7 | 1,216 | 1,064 | 1,095 |
| Single-Family Sales | 3,970 | 3,610 | 3,370 | -19.5 | 4,573 | 4,341 | 4,960 |
| Median Price, Total, $(NSA) | 171,700 | 177,500 | 182,100 | -2.4 | 172,742 | 197,233 | 216,633 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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