Global| May 24 2010U.S. Existing Home Sales Improve With Tax Credit Expiration
by:Tom Moeller
|in:Economy in Brief
Summary
Hopefully, recent improvement in existing single-family home sales wasn't all due to buying ahead of the April 30th expiration of a Federal home-buyer tax credit. Existing home sales rose 7.6% last month to 5.770M (AR) according to [...]
Hopefully, recent improvement in existing single-family home sales wasn't all due to buying ahead of the April 30th expiration of a Federal home-buyer tax credit. Existing home sales rose 7.6% last month to 5.770M (AR) according to the National Association of Realtors. The gain followed a similar rise in March which followed declines during the prior thee months. Sales in April exceeded Consensus expectations for 5.65M. Total sales include sales of condos and co-ops. Sales of existing single-family homes alone rose 7.4% from March to 5.050M. (These data have a longer history than the total sales series). Sales of condos and co-ops rose 42.3% from last year.
Sales have been helped by a tax credit for first-time home buyers. Additionally, a credit of up to $6,500 was available to some existing home owners who move. The full details of the home-buyer tax credit can be found here.
The median price of all existing homes also rose in April to $173,100 but remained off roughly 25% from the 2007 peak. The price of a single-family home rose 2.3% to $173,400 (4.5% y/y). Earlier price weakness sharply raised home affordability -- by three-quarters from the 2006 low. The median family income for existing home buyers was $60,498 and mortgage payments amounted to 14.7% of that total.
The number of unsold homes (single-family & co-ops) for sale rose sharply m/m, up 2.7% y/y. At the current sales rate there was an 8.4 months' supply of homes on the market. That was down from a high of 10.1 months during April of 2008. For single-family homes, the inventory rose m/m to an 8.2 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.
| Existing Home Sales (Thous, SAAR) | April | March | February | April y/y | 2009 | 2008 | 2007 |
|---|---|---|---|---|---|---|---|
| Total | 5,770 | 5,360 | 5,010 | 22.8% | 5,160 | 4,893 | 5,674 |
| Northeast | 1,090 | 900 | 840 | 41.6 | 863 | 845 | 1,010 |
| Midwest | 1,330 | 1.210 | 1,110 | 29.1 | 1,166 | 1,130 | 1,331 |
| South | 2,140 | 1,970 | 1,840 | 23.0 | 1,913 | 1,860 | 2,243 |
| West | 1,210 | 1,290 | 1,220 | 5.2 | 1,216 | 1,064 | 1,095 |
| Single-Family Sales | 5,050 | 4,700 | 4,360 | 20.5 | 4,573 | 4,341 | 4,960 |
| Median Price, Total, $ (NSA) | 173,100 | 169,600 | 164,600 | 4.0 | 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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