Today’s existing home sales report from theNational Association of REALTORS(R) shows existing home sales in November were at at a seasonally adjusted-annual rate of 4.68 million units which is an increase of 5.6 percent from October and is a decline of 27.9 percent from a year ago.
Prices increase slightly in November after dropping for four straight months-
The median home price in the U.S. in November was $170,600, a slight increase from October’s revised median price of $170,400 and an increase of 0.4 percent from a year ago when the median price was $170,000.
Inventory levels decrease for the month- still up from a year ago-
The number of existing homes on the market decreased in November by 4.0 percent to 3.71 million homes, but is up 5.4 percent from a year ago when there were 3.521 million homes for sale. Based upon the current rate of sales the supply that this inventory translates into dropped by 9.5 percent to 9.5 months from 10.5 months in October, but is still 46.2 percent higher than a year ago when the supply was only 6.5 months.
Metro Home Sales and Prices -
NAR publishes existing home sales for major metropolitan areas of the U.S. Highlights from that report for October include:
- None of the metro areas saw increased sales from the year before…in fact, all the metros saw double-digit decreases
- San Diego, CA had the lowest decrease in sales from a year ago with a 11.4 percent decrease.
- Phoenix,AZ had the second lowest decrease in sales from a year ago with a 11.7 percent decrease.
- Miami/Ft Lauderdale, FL had the third lowest decrease with a 13.2 percent decrease from a year ago.
- Eleven of the metros had a decrease in home prices from November 2009 to November 2010 led by Atlanta with a decrease of 16.2 percent. Phoenix, AZ came in a rather distant second with a 8.0 percent decrease in home prices.
- Washington, D.C. saw the largest one-year increase in home prices again this month with a 9.5 percent increase (who says it doesn’t pay to be in politics??).
- San Antonio, TX came in second with a 9.0 percent increase in home prices.
- Indianapolis, IN had a 5.9 percent one -year increase in home prices making it the third highest in the US.
Lawrence Yun, NAR chief economist, is hopeful for 2011. “Continuing gains in home sales are encouraging, and the positive impact of steady job creation will more than trump some negative impact from a modest rise in mortgage interest rates, which remain historically favorable,” he said.
Yun added that home buyers are responding to improved affordability conditions. “The relationship recently between mortgage interest rates, home prices and family income has been the most favorable on record for buying a home since we started measuring in 1970,” he said. “Therefore, the market is recovering and we should trend up to a healthy, sustainable level in 2011.”
I don’t like “seasonally adjusted rates of sales”:
If you have been reading my posts for a while you know by now I don’t like “seasonally adjusted” numbers when artificial stimuli, such as tax-credits, can cause an unseasonal spike in sales activity. I much prefer to see the actual numbers and try to garner from them what is going on in the housing market.
The following are the ACTUAL Existing Home sales reported by NAR without any adjustment or fluff:
- There were 353,000 existing homes sold in November which is a decrease of 1.7 percent from October and a 25.1 percent decrease from a year ago.
- Below are highlights from each region:
- Northeast – 55,000 homes sold in November, a decrease of 9.8 percent from October and a decrease of 30.4 percent from the year before.
- Midwest - 71,000 homes sold in November, a decrease of 1.4 percent from October and a decrease of 33.0 percent from the year before.
- South - 134,000 homes sold in November, a decrease of 4.3 percent from October and a decrease of 23.9 percent from the year before.
- West – 93,000 homes sold in November, an increase of 8.1 percent from October and a decrease of 15.5 percent from the year before.
Other highlights of the NAR Report:
- Distressed sales accounted for 33 percent of all home sales in November, down slightly from 34 percent the month before.
- First-Time homebuyers accounted for 32 percent of the home sales in November the same as the two proceeding months.
- Investors were the buyers of 19 percent of the homes in November the same as the proceeding month.
- Repeat home buyers were responsible for approximately 49 percent of November’s sales the same as the proceeding month.
My Take On the Numbers:
My opinion hasn’t changed since last month which was:
I think the overall U.S. housing market has, on average, more or less found it’s “bottom” in terms of sales. I think we are going to see sales rates bounce up and down as we go forward moving toward a somewhat sluggish recovery and, along the way, we are going to see more price movement as the market demands. In the short term, I think we are going to see some more price degradation in many markets, but my expectation would be at modest levels, before leveling off.