A report from the National Association of Realtors (NAR) showed that total existing home sales in America, which account for a much larger portion of the overall U.S. housing market than new home sales (due out tomorrow), fell by 3.7 percent in February to a seasonally adjusted annual rate of 5.48 million units. That is worse than expected but only the second decline in the past seven months. Regionally, home sales last month rose in the South (+1.3%) but fell in the West (-3.1%), the Midwest (-7.0%), and the Northeast (-13.8%). Total housing inventory lifted to 1.75 million existing homes available for sale in February, although this is still 6.4 percent lower compared to a year ago.
The median selling price was $229,900 last month, up 7.6 percent from February 2016 and therefore the 60th consecutive month of annual growth. The headline sales weakness last month might have been partially related to the continued, albeit modest, uptrend in mortgage rates, but existing home sales remain up 5.4 percent on a year-over-year basis, the best reading on annual growth since November. Supply issues have also influenced existing home sales recently, and Lawrence Yun, NAR chief economist, added that “Realtors are reporting stronger foot traffic from a year ago, but low supply in the affordable price range continues to be the pest that's pushing up price growth and pressuring the budgets of prospective buyers. Newly listed properties are being snatched up quickly so far this year and leaving behind minimal choices for buyers trying to reach the market.”
Sources: Econoday, Bloomberg, ZH, Twitter, NAR, U.S. FHFA, FRBSLPost author: Charles Couch