Tuesday, January 22, 2019

NAR: Existing-Home Sales Decreased to 4.99 million in December

by Bill McBride on 1/22/2019 10:12:00 AM

From the NAR: Existing-Home Sales See 6.4 Percent Drop in December

After two consecutive months of increases, existing-home sales declined in the month of December, according to the National Association of Realtors®. None of the four major U.S. regions saw a gain in sales activity last month.

Total existing-home sales, completed transactions that include single-family homes, townhomes, condominiums and co-ops, decreased 6.4 percent from November to a seasonally adjusted rate of 4.99 million in December. Sales are now down 10.3 percent from a year ago (5.56 million in December 2017).
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Total housing inventory at the end of December decreased to 1.55 million, down from 1.74 million existing homes available for sale in November, but represents an increase from 1.46 million a year ago. Unsold inventory is at a 3.7-month supply at the current sales pace, down from 3.9 last month and up from 3.2 months a year ago.
emphasis added
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 December (4.99 million SAAR) were down 6.4% from last month, and were 10.3% below the December 2017 rate.

The second graph shows nationwide inventory for existing homes.

Existing Home Inventory According to the NAR, inventory decreased to 1.55 million in December from 1.74 million in November.   Headline inventory is not seasonally adjusted, and inventory usually decreases to the seasonal lows in December and January, and peaks in mid-to-late summer.

The last 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 was up 6.2% year-over-year in December compared to December 2017.  

Months of supply was at 3.7 months in December.

For existing home sales, a key number is inventory - and inventory is still low, but appears to have bottomed. I'll have more later ...