Wednesday, December 22, 2010

November Existing Home Sales: 4.68 million SAAR, 9.5 months of supply

by Bill McBride on 12/22/2010 10:00:00 AM

The NAR reports: Existing-Home Sales Resume Uptrend with Stable Prices

Existing-home sales, which are completed transactions that include single-family, townhomes, condominiums and co-ops, rose 5.6 percent to a seasonally adjusted annual rate of 4.68 million in November from 4.43 million in October, but are 27.9 percent below the cyclical peak of 6.49 million in November 2009, which was the initial deadline for the first-time buyer tax credit.
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Total housing inventory at the end of November fell 4.0 percent to 3.71 million existing homes available for sale, which represents a 9.5-month supply at the current sales pace, down from a 10.5-month supply in October.
Existing Home Sales Click on graph for larger image in new window.

This graph shows existing home sales, on a Seasonally Adjusted Annual Rate (SAAR) basis since 1993.

Sales in November 2010 (4.68 million SAAR) were 5.6% higher than last month, and were 27.9% lower than November 2009.

Existing Home InventoryThe second graph shows nationwide inventory for existing homes.

According to the NAR, inventory decreased to 3.71 million in November from 3.86 million in October. The all time record high was 4.58 million homes for sale in July 2008.

Inventory is not seasonally adjusted and there is a clear seasonal pattern with inventory peaking in the summer and declining in the fall. I'll have more on inventory later ...

Existing Home Sales Months of SupplyThe last graph shows the 'months of supply' metric.

Months of supply decreased to 9.5 months in November from 10.5 months in October. This is very high and suggests prices, as measured by the repeat sales indexes like Case-Shiller and CoreLogic, will continue to decline.

These weak numbers are below the consensus of 4.85 million SAAR, are are close to what I expected (Lawler's forecast was 4.61 million). I'll have more later.