January 23, 2023

Existing Home Sales Lower, but Better Than Expected

The National Association of Realtors Existing Home Sales Report, which measures closings on existing homes, showed that sales were down 1.5% in December at a 4.02 million annualized pace. The report came in better than expectations, which was looking for a 3.4% decline. Year over year, Existing Home Sales are down 34%.

Housing Inventory continues to trend lower after its peak at 1.3 million in August. It declined for the fifth straight month to 970,000. This was a 13.4% decline from the previous report. The decline is a normal occurrence every time this year due to the seasonal build.

Additionally, there is a 2.9 months’ supply of homes. It is tight because normally there would be a 4.6 months’ supply of homes on the market. However, if you look at active listings, there are only 690,000 homes available which means that 29% of available inventory is under contract and cannot be purchased! This fact speaks to demand as in a normal market, only 25% of inventory is normally under contract.

As we can see, Existing Home Sales are slightly lower, but not as bad as analysts expected. It is evident that the housing market is still heavily sought out and inventory levels are low at first look, but they are even lower when you look deeper into the report again when looking at homes that are actually listed for sale. The dynamics of this current market are supportive of home pricing because inventory is still low and demand is still strong.

Source : http://bit.ly/2MJU6mf

By: Jon Iacono
A Family

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