Existing-Home Sales: Fourth Consecutive Increase
July 21, 2016
by Jill Mislinski
This morning's release of the June Existing-Home Sales increased from the previous month to a seasonally adjusted annual rate of 5.57 million units from a downwardly revised 5.51 million in May. The Investing.com consensus was for 5.48 million. The latest number represents a 1.1% increase from the previous month and a 3.0% 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 impressive four month streak of sales gains through June caps off a solid first half of 2016 for the housing market. "Existing sales rose again last month as more traditional buyers and fewer investors were able to close on a home despite many competitive areas with unrelenting supply and demand imbalances," he said. "Sustained job growth as well as this year's descent in mortgage rates is undoubtedly driving the appetite for home purchases." [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 16.6% 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 6.5% above the NAR's January 2000 estimate. The population-adjusted version is 7.6% below the turn-of-the-century sales.
For additional perspectives on residential real estate, here is the complete list of our monthly updates: