Tuesday, April 21, 2020

Comments on March Existing Home Sales

by Calculated Risk on 4/21/2020 11:20:00 AM

Earlier: NAR: Existing-Home Sales Decreased to 5.27 million in March

A few key points:

1) This is mostly pre-crisis data.   Existing home sales are counted at the close of escrow, so this report is mostly for contracts signed in January and February.   Sales will decline sharply in April and May.

2) Existing home sales were up 0.8% year-over-year (YoY) in March.

2) Inventory is very low, and was down 10.2% year-over-year (YoY) in March. Inventory will probably stay low as people wait to list their homes - and do not want strangers in their house.   This is the lowest level of inventory for March since at least the early 1990s.

Existing Home Sales YoY Click on graph for larger image.

Signed contracts will probably be down sharply year-over-year in April and May.

Note that existing home sales picked up somewhat in the second half of 2019 as interest rates declined.

Existing Home Sales NSAThe second graph shows existing home sales Not Seasonally Adjusted (NSA) by month (Red dashes are 2020), and the minimum and maximum for 2005 through 2019.

Sales NSA in March (415,000) were just above sales last year in March.

Note that sales have been in the middle of the range recently - not absurdly high like in 2005, and not depressed like in 2010 and 2011.

With the pandemic, sales will decline sharply over the next few months.