December Existing Home Sales Take Off
The National Association of Realtors (NAR) reports that the seasonally adjusted annual rate of existing home sales in December soared 14.7% to a seasonally adjusted annual rate of 5.46 million from a total of 4.76 million in November.
December sales reverse a sharp decline in November, the first in over a year, which the NAR attributed to processing delays due to the new “Know Before You Owe” rules (TRID in mortgage-speak). Sales were 7.7% higher than in December 2014.
The consensus estimate called for sales to reach 5.2 million, according to a survey of economists polled by Bloomberg.
The NAR’s chief economist said:
While the carryover of November’s delayed transactions into December contributed greatly to the sharp increase, the overall pace taken together indicates sales these last two months maintained the healthy level of activity seen in most of 2015. Additionally, the prospect of higher mortgage rates in coming months and warm November and December weather allowed more homes to close before the end of the year.
Housing inventory decreased by 12.3% in December to 1.79 million homes, which is equal to a supply of 3.9 months, a sharp drop from 5.1 months in November, and 3.8% lower than the 1.86 million homes in inventory in December of last year.
According to the NAR, the national median existing home price for all housing types in December was $224,100, up 7.6% compared with December 2014, the 46th consecutive month of rising home prices. In November 2015, the national median price was $220,300.
The percentage of first-time buyers increased to 32% in December, up from 30% in November and from 29% in December 2014.
Sales of single-family homes jumped 16.1% from the November total to a seasonally adjusted annual rate of 4.82 million, up 7.1% compared with December 2014. Sales of multifamily homes rose 4.9% in December at a seasonally adjusted annual rate of 640,000 units.
Foreclosed and short sales accounted for 8% of December sales, down from 9% in November and down 11% compared with December of 2014. Foreclosures and short sales both sold at an average 15% discount to the December median price.
All homes were on the market for an average of 58 days in December, up from 54 days in November. Foreclosed homes were on the market for an average of 68 days, and short sales took a median of 86 days to sell. Non-distressed homes took 57 days to sell, and 32% of homes sold in December were on the market for less than a month.
The NAR also reported the following regional data:
- December existing-home sales in the Northeast rose 8.7% year over year to an annual rate of 750,000, and they are now 11.9% above a year ago. The median price in the Northeast was $255,700, which is 5.3% higher than December 2014.
- In the Midwest, existing-home sales jumped 10.9% to an annual rate of 1.22 million in December and are now 9.9% above December 2014 sales. The median price in the Midwest was $171,000, up 7.5% from a year ago.
- Existing-home sales in the South popped 14.6% to an annual rate of 2.27 million in December, and they are now 4.6% above December 2014 sales. The median price in the South was $196,100, up 6.8% from a year ago.
- Existing-home sales in the West soared by 23.2% to an annual rate of 1.22 million in December and are now 8.9% higher than a year ago. The median price in the West was $321,100, which is 8.2% above the December 2014 median.