The strong start to 2017 existing home sales faltered already. February wiped out the 3.3% gains in January, and then some. Econoday blames “inventory” as does Mortgage News Daily.
Existing home sales are on the soft side of expectations, down 3.7 percent in February to a 5.480 million annualized rate and below the Econoday consensus for 5.555 million. Details are mostly weak including a 3.0 percent decline in single-family sales to a 4.890 million rate and a sharp 9.2 percent drop for condos to a 590,000 rate. Year-on-year, single-family sales are up 5.8 percent with condos fading and barely over zero at 1.7 percent.
But total year-on-year sales are up a solid 5.4 percent and still below pricing where the median, at $228,400, is up a healthy 7.7 percent. Supply has been very thin but is improving, with 1.750 million resales on the market for a 4.2 percent gain from January. And relative to sales, supply is at 3.8 months vs January’s 3.5 months. Days on the market are very short, at 45 vs 59 days a year ago.
Existing Sales Stifled By Inventory Constraints
Mortgage News Daily reports Existing Sales Stifled By Inventory Constraints.
Existing home sales burst out of the box in January to start the year out with a 3.2 percent increase over the previous month. Those gains, however, were wiped out in February. The National Association of Realtors® (NAR) said on Wednesday that sales of previously owned homes, including single-family structures, townhomes, condos, and co-ops, retreated by 3.7 percent, to a seasonally adjusted annual rate of 5.48 million units. NAR did not revise their original estimate of a 5.69-million-unit pace in January. Even with the decline, sales still maintained their edge over February 2016 by 5.4 percent.
Sales of single-family homes were down by 3.0 percent to an annual rate of 4.89 million from 5.04 million in January, remaining 5.8 percent above the 4.62 million sales pace in February 2016. Condo and co-op apartment sales plunged month-over-month by 9.2 percent to 590,000 units from 650,000 but remained 1.7 percent higher than sales in February 2016.
Lawrence Yun, NAR chief economist, said buyers in most of the country were “stifled” by the lack of properties for sale and weakening affordability. He said, “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.”
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