Home Sales in November Up for Second Straight Month

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By Mark Lieberman

Managing Director and Senior Economist

Highlights

  • The pace of existing home sales – closed sales — ROSE 1.9 percent, 100,000, in November to a seasonally adjusted annual sales rate of 5.32 million;
  • Median price of an existing single-family home ROSE 0.7 percent, $1,900, to $257,000;
  • Year-year the median price is up 4.0 percent or $9,800;
  • Number of homes available for sale FELL 110,000 or 6.3 percent to 1.74 million;
  • The months’ supply of homes for sale in November was DOWN 0.4 months to 3.9 months.

Trends:

  • Existing home sales ROSE for the second straight month after falling for six months in a row;
  • Year-year sales were DOWN 7.0 percent, the ninth month in a row year-year sales have slipped;
  • Number of homes for sale DECLINED for the fourth straight month, to the lowest level since March; the steepest month-month decline since last December;
  • The median price of an existing single-family home ROSE for the first time in five months;

Data Source: National Association of Realtors: (NAR)

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Realtors weren’t exactly popping champagne corks though they might have been as existing single family home sales rose for the second straight month for the first time since February-March of this year. Even so, the level of home sales in November was 5 percent below March.

The National Association of Realtors’ November report, though positive, suggested future concerns as the number of homes for sale dropped to the lowest level in eight months, bringing to mind realtor complaints earlier this year of weak inventory.

(The pending home sales index for September showed an increase which forecast the sales report for November. The PHSI for October tumbled 2.6 percentage points. In the last six months, the PHSI fell four times – and existing home sales dropped four times in the period.)

Looking deeper at the November closings report, it chronicled the median price of existing home sales which showed four month-month decline which did not send sales up suggesting home buyers are not driven by prices.

The same fundamentals have been in effect for virtually the entire year, overshadowed by tax law changes which eliminated most of the tax incentives for homeownership.

The report noted home sales fell only in the West which, coincidentally, was the only census regions which saw the median price of an existing single family home fall – down for the fourth time in the last five months (the median price was flat month-month in the fifth).

Would-be homebuyers are still plagued by weak earnings growth and, with the odds of a recession in the near future growing, memories of the housing downturn a decade ago as well as rising interest rates.

Ironically, the prospect of higher rates might actually boost sales as buyers rush to act before rates go higher.

Hear Mark Lieberman every Friday, on the Morning Briefing on P.O.T.U.S. radio @sxmpotus, Sirius-XM 124, at 6:20 am Eastern Time. You can follow Mark Lieberman on Twitter at @foxeconomics.

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