Existing-Home Sales Eased Up in August
This morning's release of the August Existing-Home Sales decreased from the previous month to a seasonally adjusted annual rate of 5.33 million units from a downwardly revised 5.38 million in July. The Investing.com consensus was for 5.45 million. The latest number represents a 0.9% decrease from the previous month and a 0.8% increase year-over-year.
Here is an excerpt from today's report from the National Association of Realtors.
Lawrence Yun, NAR chief economist, says recent job growth is not yielding higher home sales. "Healthy labor markets in most the country should be creating a sustained demand for home purchases," he said. "However, there's no question that after peaking in June, sales in a majority of the country have inched backwards because inventory isn't picking up to tame price growth and replace what's being quickly sold."
Added Yun, "Hopes of a meaningful sales breakthrough as a result of this summer's historically low mortgage rates failed to materialize because supply and affordability restrictions continue to keep too many would-be buyers on the sidelines." [Full Report]
For a longer-term perspective, here is a snapshot of the data series, which comes from the National Association of Realtors. The data since January 1999 was previously available in the St. Louis Fed's FRED repository and is now only available from January 2013. It can be found here.
Over this time frame we clearly see the Real Estate Bubble, which peaked in 2005 and then fell dramatically. Sales were volatile for the first year or so following the Great Recession. The latest estimate puts us back to the general level around the turn of the century.
The Population-Adjusted Reality
Now let's examine the data with a simple population adjustment. The Census Bureau's mid-month population estimates show a 16.8% increase in the US population since the turn of the century. The snapshot below is an overlay of the NAR's annualized estimates with a population-adjusted version.
Existing-home sales are 1.9% above the NAR's January 2000 estimate. The population-adjusted version is 11.7% below the turn-of-the-century sales.
For additional perspectives on residential real estate, here is the complete list of our monthly updates: