Monday, September 21, 2015

Lawler on Existing Home Sales

by Bill McBride on 9/21/2015 03:49:00 PM

In a report released today, the National Association of Realtors estimated that US existing home sales ran at a seasonally adjusted annual rate of 5.31 million, down 4.8% from July’s downwardly-revised (to 5.58 million from 5.59 million) pace and up 6.2% from last August’s seasonally-adjusted pace. The NAR’s estimate was way below both consensus and my estimate from early last week based on regional tracking.

Part of my “miss” was a “misread” of this August’s seasonal factors, which I had assumed would be significantly (rather than just slightly) lower than last August’s seasonal factor (related to the timing of Labor Day.)

In addition, most realtor/MLS reports released subsequent to when I issued my forecast – including many released today – came in below what I had assumed (I put out my “early read” after getting enough local realtor/MLS reports to produce a “reasonable” projection).

However, even after taking into account publicly-available reports released through today, my “regional tracking methodology” comes up with faster YOY growth in sales (on a not seasonally adjusted basis) than that shown by the NAR.

Net, my forecast for August existing home sales as measured by the National Association of Realtors was way off track, and I apologize for this.

The NAR also estimated that the inventory of existing homes for sale at the end of August was 2.29 million, up 1.3% from July’s upwardly-revised (to 2.26 million from 2.24 million) level and down 1.7% from last August. Local realtor/MLS data suggested to me that the August inventory level would be down slightly from July.

Finally, the NAR estimated that the median existing SF home sales price in August was $230,200, up 5.1% from a year earlier. This YOY increase was slightly higher than my forecast.