Global| Jan 22 2019U.S. Existing Home Sales Drop to Three-Year Low
Summary
The National Association of Realtors reported that sales of existing homes fell a greater-than-expected 6.4% in December to 4.990 million units (SAAR). This was the lowest reading and largest month-on-month decline since a regulatory- [...]
The National Association of Realtors reported that sales of existing homes fell a greater-than-expected 6.4% in December to 4.990 million units (SAAR). This was the lowest reading and largest month-on-month decline since a regulatory-change-driven divot in sales in November 2015. In the year ending December 2017, existing home sales are down 10.3%, the biggest drop since May 2011. The Action Economics Forecast Survey expected sales of 5.22 million units. November's reading was revised slightly higher to 5.33 million.
The median price of all existing homes sold declined 1.4% (+2.9% y/y) last month to $253,600. Prices hit a record $273,800 in June. The average sales price fell 1.1% (+1.6% y/y) to $292,800. Sales price data is not seasonally adjusted, so it is not surprising that prices declined month-on-month in December.
Existing home sales weakened in every region of the country. The Midwest led the decline with a drop of 11.2% (-10.5% y/y) to an almost two-year low of 1.19 million. The Northeast fell 6.8% (-6.8% y/y) and the South was down 5.4% (-8.7% y/y). There was no sign of rebound from the wildfire-driven November weakness in the West as sales softened 1.9% (-15.0% y/y).
Sales of existing single-family homes dropped 5.5% (-10.1% y/y) to 4.45 million units, the weakest reading in three years. Sales of condos and co-ops plummeted 12.9% (-11.5% y/y) to 540,000 units, the lowest level since July 2012.
The number of homes on the market fell for the sixth consecutive month, but remained up 6.2% y/y. The months' supply of homes on the market declined to 3.7, the least since March.
The data on existing home sales, prices and affordability are compiled by the National Association of Realtors and can be found in Haver's USECON database. The regional price, affordability and inventory data are available in the REALTOR database. The expectations figure is from the Action Economics Forecast Survey, reported in the AS1REPNA database.
| Existing Home Sales (SAAR, 000s) | Dec | Nov | Oct | Y/Y % | 2018 | 2017 | 2016 |
|---|---|---|---|---|---|---|---|
| Total | 4,990 | 5,330 | 5,220 | -10.3 | 5,343 | 5,536 | 5,441 |
| Northeast | 690 | 740 | 690 | -6.8 | 688 | 737 | 735 |
| Midwest | 1,190 | 1,340 | 1,270 | -10.5 | 1,266 | 1,304 | 1,298 |
| South | 2,090 | 2,210 | 2,150 | -8.7 | 2,248 | 2,270 | 2,217 |
| West | 1,020 | 1,040 | 1,110 | -15.0 | 1,141 | 1,225 | 1,192 |
| Single-Family | 4,450 | 4,710 | 4,620 | -10.1 | 4,746 | 4,910 | 4,825 |
| Median Price Total ($, NSA) | 253,600 | 257,300 | 255,100 | 2.9 | 257,175 | 245,950 | 232,067 |
Gerald D. Cohen
AuthorMore in Author Profile »Gerald Cohen provides strategic vision and leadership of the translational economic research and policy initiatives at the Kenan Institute of Private Enterprise.
He has worked in both the public and private sectors focusing on the intersection between financial markets and economic fundamentals. He was a Senior Economist at Haver Analytics from January 2019 to February 2021. During the Obama Administration Gerald was Deputy Assistant Secretary for Macroeconomic Analysis at the U.S. Department of Treasury where he helped formulate and evaluate the impact of policy proposals on the U.S. economy. Prior to Treasury, he co-managed a global macro fund at Ziff Brothers Investments.
Gerald holds a bachelor’s of science from the Massachusetts Institute of Technology and a Ph.D. in Economics from Harvard University and is a contributing author to 30-Second Money as well as a co-author of Political Cycles and the Macroeconomy.
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