Existing-Home Sales Jump Again in October
This morning's release of the October Existing-Home Sales increased from the previous month to a seasonally adjusted annual rate of 5.60 million units from an upwardly revised 5.49 million in September. The Investing.com consensus was for 5.43 million. The latest number represents a 2.0% increase from the previous month and a 5.9% increase year-over-year.
Here is an excerpt from today's report from the National Association of Realtors.
Lawrence Yun, NAR chief economist, says the wave of sales activity the last two months represents a convincing autumn revival for the housing market. "October's strong sales gain was widespread throughout the country and can be attributed to the release of the unrealized pent-up demand that held back many would-be buyers over the summer because of tight supply," he said. "Buyers are having more success lately despite low inventory and prices that continue to swiftly rise above incomes."
Added Yun, "The good news is that the tightening labor market is beginning to push up wages and the economy has lately shown signs of greater expansion. These two factors and low mortgage rates have kept buyer interest at an elevated level so far this fall." [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 16.9% 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 7.1% above the NAR's January 2000 estimate. The population-adjusted version is 7.4% below the turn-of-the-century sales.