Thursday, November 20, 2014

Existing Home Sales in October: 5.26 million SAAR, Inventory up 5.2% Year-over-year

by Bill McBride on 11/20/2014 10:11:00 AM

The NAR reports: Existing-Home Sales Rise in October, First Year-Over-Year Increase since October 2013

Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, rose 1.5 percent to a seasonally adjusted annual rate of 5.26 million in October from an upwardly-revised 5.18 million in September. Sales are at their highest annual pace since September 2013 (also 5.26 million) and are now above year-over-year levels (2.5 percent from last October) for the first time since last October. ...

Total housing inventory at the end of October fell 2.6 percent to 2.22 million existing homes available for sale, which represents a 5.1-month supply at the current sales pace – the lowest since March (also 5.1 months). Unsold inventory is now 5.2 percent higher than a year ago, when there were 2.11 million existing homes available for sale.
Existing Home SalesClick on graph for larger image.

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

Sales in October (5.26 million SAAR) were 1.5% higher than last month, and were 2.5% above the October 2013 rate.

The second graph shows nationwide inventory for existing homes.

Existing Home InventoryAccording to the NAR, inventory decreased to 2.22 million in October from 2.28 million in September.   Headline inventory is not seasonally adjusted, and inventory usually increases from the seasonal lows in December and January, and peaks in mid-to-late summer.

The third graph shows the year-over-year (YoY) change in reported existing home inventory and months-of-supply. Since inventory is not seasonally adjusted, it really helps to look at the YoY change. Note: Months-of-supply is based on the seasonally adjusted sales and not seasonally adjusted inventory.

Year-over-year Inventory Inventory increased 5.2% year-over-year in October compared to October 2013.  

Months of supply was at 5.1 months in October.

This was above expectations of sales of 5.15 million.  For existing home sales, the key number is inventory - and inventory is still low, but up year-over-year.    I'll have more later ...