December’s report on existing home sales

The only widely watched report that was released this past week was the existing home sales report for December from the National Association of Realtors (NAR); the week also saw the release of the Regional and State Employment and Unemployment Summary for December from the Bureau of Labor Statistics, which breaks down the previously published employment data by state and region, and the Chicago Fed National Activity Index (CFNAI) for December, a weighted composite index of 85 different economic metrics, which fell to -0.35 in December, down from +0.41 in November, which was also revised down from the +0.56 reported last month…nonetheless, the 3 month average of the CFNAI rose to –0.23 in December, up from a revised –0.31 in November, which still indicates that national economic activity continued at a pace below the historical trend over the 4th quarter months…in addition, the week also saw the release of the Kansas City Fed manufacturing survey for January, covering western Missouri, Colorado, Kansas, Nebraska, Oklahoma, Wyoming and northern New Mexico, which reported its broadest composite index rose to -1 in January, up from -5 in December and -2 in November, indicating a moderation of the contraction of that region’s manufacturing…

December Existing Home Sales Up 3.6% As Price Increases Widen

The National Association of Realtors (NAR) reported that their seasonally adjusted count of existing home sales rose by 3.6% from November to December, the 4th increase in six months, projecting that 5.54 million existing homes would sell over an entire year if the December home sales pace were extrapolated over that year, a pace that was also 10.8% above the annual sales rate they projected in December of a year ago.…November sales are indicated to have been at a 5.35 million rate, unrevised from the annual rate indicated by last month’s report…for the year, existing home sales totaled 5.34 million, the same number as sold in 2018, but 3.1% fewer than the 5.51 million homes that were sold in 2017…the NAR also reported that the median sales price for all existing-home types was $274,500 in December, which was up from $271,300 in November, and 7.8% higher than in December a year earlier, which they report “marks 94 straight months of year-over-year gains“…..the NAR press release, which is titled “Existing-Home Sales Climb 3.6% in December“, is in easy to read plain English, so if you’re interested in the details on housing inventories, cash sales, distressed sales, first time home buyers, etc., you can easily find them in that press release…as sales of existing properties do not add to our national output, neither these home sales nor the prices for which these homes sell for are included in GDP, except insofar as real estate, local government and banking services are rendered during the selling process…

Since this report is entirely seasonally adjusted and at a not very informative annual rate, we like to look at the raw data overview (pdf) to see what actually transpired during the month…this unadjusted data indicates that roughly 434,000 homes sold in December, up by 7.4% from the 404,000 homes that sold in November, and 15.1% more than the 377,000 homes that sold in December of last year, so we can see that the seasonal adjustments had a modest negative impact on the published figures….that same pdf indicates that the median home selling price for all housing types rose 1.2%, from a revised $271,300 in November to $274,500 in December, while the average home sales price was $311,200, up 1.0% from the $308,200 average sales price in November, and up 5.9% from the $293,800 average home sales price of December a year ago…for the year as a whole, the median home sales price was at $271,800, up 4.8% from the median sales prices of $259,300 in 2018, while the average home sales price was at $308,400, a 3.4% increase from the $298,200 average home sales price in 2018…for both seasonally adjusted and unadjusted graphs and additional commentary on this report, see the following two posts from Bill McBride at Calculated Risk: NAR: Existing-Home Sales Increased to 5.54 million in December and Comments on December Existing Home Sales

 

(the above is the synopsis that accompanied my regular sunday morning links emailing, which in turn was mostly selected from my weekly blog post on the global glass onion…if you’d be interested in receiving my weekly emailing of selected links, most picked from the aforementioned GGO posts, contact me…)

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