November Existing Home Sales

The National Association of Realtors released a very strong report detailing sales of existing homes in November.  At an annualized rate of 6.54 million units, the total was up 7.4%, well above the most optimistic projections.  Remember, this adds to the robust 9.9% surge we saw in October.  The current supply is now down to 6.5 months, a level that begins to touch the top border of what is considered to be a healthy range between five and six months worth.  Accordingly, we are moving our needle for this indicator up another notch, further into positive territory.  There are plenty of other reasons to substantiate our optimism.  Sales exhibited strength across all regions of the country.  Year-over-year single-family home sales are now rising at a 42% rate while condominium sales are soaring at a 60% Y/Y clip.  The current inventory of existing homes has fallen to a 3 1/2 year low.  Prices, while still down on an annual basis, rose 0.2% to a median $172,600 on November and are off a scant 4.3% annualized.  No doubt at least some of the credit goes to stimulus programs initiated by the government which were scheduled originally to end in November.  Many of the sales may have been initiated earlier than would normally have been the case, thereby getting captured by this data, as buyers availed themselves of the credits before expiration.  With this stimulus program now both extended and expanded, we anticipate another wave of buyers could take advantage of it in the near future, although it may take a couple of months for all parties involved, buyers, agents, lenders, and so forth, to get ramped up again.  We’re hopeful that more good news is yet to come.