June Sales of Existing Home Fall Short of Estimates

The National Association of Realtors (NAR) reports that the seasonally adjusted annual rate of existing-home sales in June dipped 1.7% to a seasonally adjusted annual rate of 5.27 million from a total of 5.34 million in May. Sales remain down 2.2% compared to June 2018 sales of 5.39 million.

Through the first six months of 2019, sales have seesawed, but the trend is decidedly downward. June’s sales dip, though not a big concern, was below the consensus estimate for June sales of 5.32 million, according to a survey of economists polled by Bloomberg.

The NAR’s chief economist, Lawrence Yun, said:

Home sales are running at a pace similar to 2015 levels – even with exceptionally low mortgage rates, a record number of jobs and a record high net worth in the country. Imbalance persists for mid-to-lower priced homes with solid demand and insufficient supply, which is consequently pushing up home prices

Existing-home sales closed 2018 with a seasonally adjusted December total of 4.99 million. The seasonally adjusted number for December 2017 was 5.56 million.

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Housing inventory increased slightly in June to 1.93 million homes, equal to a supply of 4.4 months, up by 0.1 months compared with May. Inventory was also up from 4.3 months year over year in June 2018.

According to the NAR, the national median existing-home price for all housing types in June was $285,700, up 4.3% compared with June 2018, the 88th consecutive month of rising home prices. In January the national median price was $247,500.

The percentage of first-time buyers rose from 32% in May to 35% in June. First-time buyers also accounted for 31% of sales in June 2018. For all of 2018, first-time buyers accounted for 33% of sales.

Sales of single-family homes slid from a seasonally adjusted annual rate of 4.76 million in May to 4.69 million in June and are down 1.7% compared with June 2018 sales of 4.77 million. Sales of multi-family homes fell 3.3% month over month to a seasonally adjusted annual rate of 580,000 units and remain 6.5% below the June 2018 average.

All homes were on the market for an average of 27 days in June, up by just one day month over month and year over year. Distressed sales, foreclosures and short sales accounted for 2% of all June sales, unchanged compared with the prior month and down from 3% in June of last year.

The NAR also reported the following regional data:

• June existing-home sales in the Northeast increased to an annual rate of 680,000 and were up 4.5% compared with June 2018 sales. The median price in the Northeast was $321,200, up 4.8% compared with the same month last year.
• In the Midwest, existing-home sales were up 1.6% in June to an annual rate of 1.25 million but down 1.6% compared with the June 2018 rate. The median price in the Midwest was $230,400, up 6.7% from a year ago.
• Existing-home sales in the South dipped 3.4% in June to an annual rate of 2.25 million and were down 1.7% compared with June 2018 sales. The median price in the South was $248,600, up 4.9% from a year ago.
• Existing-home sales in the West dropped 3.5% to an annual rate of 1.09 million in June and are down 5.2% compared with June 2018 totals. The median price in the West was $410,000, up 2.3% compared with the June 2018 median.

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