December Existing Home Sank 10%
The National Association of Realtors (NAR) reports that the seasonally adjusted annual rate of existing home sales in December 10.3% to a seasonally adjusted annual rate of 4.99 million from a total of 5.56 million in December 2017. Month-over-month sales were down 6.4%.
The consensus estimate called for December sales to reach 5.225 million according to a survey of economists polled by Bloomberg.
The NAR’s chief economist, Lawrence Yun, said:
The housing market is obviously very sensitive to mortgage rates. Softer sales in December reflected consumer search processes and contract signing activity in previous months when mortgage rates were higher than today. Now, with mortgage rates lower, some revival in home sales is expected going into spring.
Existing-home sales totaled around 5.51 million in 2017. Yun had previously forecast existing-home sales to decline by 3.1% in 2018 to 5.34 million. Final sales data for last year were not released.
Housing inventory decreased by 11% in December to 1.55 million homes, equal to a supply of 3.7 months, down by 0.2 months compared with November. Inventory is up from 3.2 months year over year in November 2017.
According to the NAR, the national median existing home price for all housing types in November was $253,600, up 2.9% compared with December 2017, the 82nd consecutive month of rising home prices. In November the national median price was $257,700.
The percentage of first-time buyers dipped from 33% in November to 32%, equal to the percentage in December 2017. For all of 2017, first-time buyers accounted for 34% of sales.
Sales of single-family homes decreased from a seasonally adjusted annual rate of 4.71 million in November to 4.45 million in December and are down 10.1% compared with December 2017. Sales of multi-family homes dropped 12.9% month over month in December to a seasonally adjusted annual rate of 540,000 units.
All homes were on the market for an average of 46 days in December, up by 4 days month over month and up from 40 days in December 2017. Distressed sales–foreclosures and short sales accounted for 2% of all December sales, unchanged compared with the prior month and down from 5% in December 2017.
The NAR also reported the following regional data:
December existing-home sales in the Northeast fell by 6.8% to an annual rate of 690,000 and were down 6.8% compared with December 2017 sales. The median price in the Northeast was $283,400, up 8.2% compared with the same month last year.
In the Midwest, existing-home sales plunged by 11.2% last month to an annual rate of 1.19 million and remain down 10.5% compared with the December 2017 rate. The median price in the Midwest was $199,300, unchanged from a year ago.
Existing-home sales in the South dropped 5.4% in December to an annual rate of 2.09 million and are down 8.7% compared to December 2017 sales. The median price in the South was $224,300, up 2.5% from a year ago.
Existing-home sales in the West slipped by 1.9% to an annual rate of 1.02 million in December and are down 15% compared with December 2017 totals. The median price in the West was $374,400, up 0.2% compared with the December 2017 median.