July Existing Home Sales

Sales of existing-homes advanced 2.4 percent in July according to the National Association of Realtors.   Total transactions grew to 5.15 million on a seasonally adjusted annualized basis, up from June’s downwardly revised total of 5.03 (originally 5.04 million).  Rising for four consecutive months, July’s existing-home sales were at the highest level of 2014 but are 4.3 percent short of the 2013 peak of 5.38 million which happened in the same month last year.

Price measures firmed in the period as well. The median existing-home price was $222,900, which is 4.9 percent higher than a year earlier.  July is the 29th consecutive month in which year-over-year prices moved higher.  The average price increased to $268,700, an uptick of $600.00 for the month.  On a year-over-year basis, the mean price improved by $9,700.

Supply statistics were mixed.  They increased in absolute terms, but stagnated relative to the number of months it would take to deplete the entire stock.  There are now 2.37 million units for sale, an uptick of 3.5 percent for the month and 5.8 percent higher than a year earlier.   However, because the number of transactions increased, it would still take 5.5 months to sell the entire inventory at July’s pace of sales.

Positive contributions from the existing-home market are an important component to America’s economy.  This market is roughly ten times as big as its new housing counterpart.  And while the actual transaction does not show up in Gross Domestic Product (GDP), there tends to be associated consumption (furniture, drapes, flooring, landscape, etc.) that helps the nation’s tally.  This indicator continues to reflect a growing economy.              (by C. Cox)