Existing Home Sales Skid to Pre-Pandemic Level, a Housing Bust is Underway

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by Mish Shedlock, Mish Talk:

Existing home sale declined for the third month. It’s just a start of what’s coming.

The National Association of Realtors reports Existing-Home Sales Retract 2.4% in April

Report Highlights 

  • Existing-home sales fell for the third straight month to a seasonally adjusted annual rate of 5.61 million.

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  • Sales were down 2.4% from the prior month and 5.9% from one year ago.
  • With slower demand, the inventory of unsold existing homes climbed to 1.03 million by the end of April, or the equivalent of 2.2 months of the monthly sales pace.\
  • The median existing-home sales price increased at a slower year-over-year pace of 14.8% to $391,200.
  • All-cash sales accounted for 26% of transactions in April, down from 28% in March and up from the 25% recorded in April 2021.
  • Individual investors or second-home buyers, who make up many cash sales, purchased 17% of homes in April, down from 18% in March and equal to 17% in April 2021.
  • According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage was 4.98% in April, up from 4.17% in March. The average commitment rate(link is external) across all of 2021 was 2.96%.

“The market is quite unusual as sales are coming down, but listed homes are still selling swiftly, and home prices are much higher than a year ago,” said NAR chief economist Lawrence Yun.

The NAR’s PowerPoint Presentation has many interesting charts worth a review.

Median Price of Existing Home Sales

Median price of Existing home sales 2022-04

Percent Change of Existing Home Sales by Price Range

Percent Change of Existing home sales by Price Range 2022-04

Year-Over-Year Percent Change of Existing Home Sales 

Percent Change of Existing home sales Year-Over-Year 2022-04

Key Chart Ideas

  • Year-over-year sales are down 9 consecutive months.
  • Sales of homes over $500,000 are up, below $500,000 down
  • The median price of sales continues to rise

Econoday Consensus 

Existing home sales Econoday 2022-04

Amusing Economists 

Economists are more than a bit amusing. One predicted a 4 percent rise in sales. What was that person’s thought process?

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