Global| Nov 23 2009U.S. Existing Home Sales Surge To Highest Since 2007 As Prices Fall Again
by:Tom Moeller
|in:Economy in Brief
Summary
Improved affordability is a great help when buying a home. The National Association of Realtors reported that October sales of existing homes rose sharply to the highest level since July 2007. The 10.1% m/m increase to 6.100M units [...]
Improved affordability is a great help when buying a home. The
National Association of Realtors reported that October sales of
existing homes rose sharply to the highest level since July
2007. The 10.1% m/m increase to 6.100M units (SAAR) followed an 8.8%
rise during September and it raised sales to the highest level since
February 2007. Moreover, sales were up by more than one-third from the
January low. The gain in October home sales outpaced Consensus
expectations for a rise to 5.70M. Total sales include sales of condos
and co-ops.
Sales of existing single-family homes alone increased a sharp 9.7% to 5.330M (21.4% y/y) last month and were up 20.7% from the January low. (These data have a longer history than the total sales series). Sales of condos and co-ops rose 13.2% and were up by nearly one-half from last October.
Sales have been helped by a recently extended tax credit for
first-time home buyers. The credit of up to $8,000 runs though early
next year. The full details of the home-buyer tax credit can be found here.
The median price of all existing homes fell for the fourth straight month, to $173,100. Though prices were still lower than the year-ago level, they have risen 5.0% from the January low. The median price for a single-family home alone fell to $173,100 (-6.8% y/y). These price declines have sharply raised home affordability. During September the composite index of home affordability rose again and was up 18.2% from the year ago level.
The number of unsold homes (condos & single-family) for sale fell 3.7% (-14.9% y/y) during October fell to the lowest level since January 2007. At the current sales rate there was a 7.0 months' supply of homes on the market which was nearly the lowest since early-2007. The latest figure was down from a high of 11.3 months early last year. For single-family homes, the inventory fell 3.2% m/m (-14.3% y/y). At the current sales rate there was a 6.8 month's supply of single-family homes on the market, the lowest since early-2007.
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.
Preventing a Repeat of the Money Market Meltdown of the Early-1930s from the Federal Reserve Bank of Dallas can be found here
.| Existing Home Sales (Thous, SAAR) | October | September | August | Oct. Y/Y | 2008 | 2007 | 2006 |
|---|---|---|---|---|---|---|---|
| Total | 6,100 | 5,540 | 5,090 | 23.5% | 4,893 | 5,674 | 6,516 |
| Northeast | 1,060 | 950 | 910 | 27.7 | 845 | 1,010 | 1,093 |
| Midwest | 1,430 | 1,250 | 1,140 | 28.8 | 1,130 | 1,331 | 1,494 |
| South | 2,300 | 2,040 | 1,890 | 25.7 | 1,860 | 2,243 | 2,577 |
| West | 1,310 | 1,290 | 1,150 | 12.0 | 1,064 | 1,095 | 1,357 |
| Single-Family | 5,330 | 4,860 | 4,470 | 21.4 | 4,341 | 4,960 | 5,712 |
| Median Price, Total, $ | 173,100 | 176,000 | 177,300 | -7.1 | 197,250 | 216,633 | 222,042 |
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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