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Existing Home Sales Data (California Real Estate: On Sale!)

Posted By Barry Ritholtz On April 26, 2006 @ 6:45 am In Data Analysis,Federal Reserve,Fixed Income/Interest Rates,Real Estate | Comments Disabled

Sales of existing homes surprised to the upside yesterday. But one data point does not make a trend. This is the first rise (sequential monthly change) after 5 straight months of falling Home Sales. And that’s before we examine the data.

Before you declare the end of the housing slow down, consider:

- Existing Home sales actually slipped vs. last year by -0.7%; The reported gain was over last month’s data;

- the Inventory of unsold homes soared 7 percent in March, hittting an all-time record; There are now 3.19 million existing homes for sale, or  5.5 months’ supply; That’s the largest inventory since July 1998

- Existing homes edged up 0.3% last month to a seasonally adjusted annual rate of
6.92 million units; (we know that seasonally adjusted data is not always accurate)

- Year over year, the Northeast and Midwest gained, while the previously hot housing markets in the South and the West slipped;

- median home prices are still rising, albeit nmore slowly — up 7.4% year over year, to $218,000.

Here’s a data point that has me scratching my head:  Why are there different numbers for the year-over-year changes for seasonally and not seasonally adjusted?  Was this March somehow in a different season than last year’s March? I am perplexed.

Note that data for existing home sales comes from National Association of Realtors, a group that is certainly an interested party; Of course, as a homeowner, investor, and someone with a public bearish tilt for the second half, I’m hardly objective myself (hey, I try). But this oddity — down -0.5% for the not seasonally adjusted year over year versus down -0.7% for the seasonally adjusted year over year — is beyond my comprehension.

So much for the hard data on existing sales; Today, we get New Home Sales. Recall our prior admonishments that monthly New Home Sales Data are unreliable [1]; look instead to a moving average.

Let’s move onto some anecdotal evidence.  A friend writes:

"Flop! Wow, KB running blue light specials in California. Not surprising,
Chico area was rated one of the most overvalued markets in the country. Houses
in the $200k space.  When was the last time you saw that in California? "

Oak Knoll Place Live Oak, CA

Oak Knoll Place Slideshow

[2] [3]

Here’s the sales pitch:

"Oak Knoll Place in Live Oak is located in a beautiful
community near the majestic Sutter Buttes. With easy access to Highway 99, it is
ideally located for easy access to Sacramento, Lake Tahoe, Reno and a wide
variety of recreational opportunities. Yuba City and Marysville are
approximately 10 minutes south, Chico is approximately 35 miles north and the
Gray Lodge Wildlife area is approximately 10 minutes west. Live Oak has a
quaint, small-town atmosphere with many nearby recreational water activities,
including the Feather River, Yuba River and Sacramento River. Prices starting
from the High $200′s.

I don’t know Live Oak, but houses like that in California are hard to imgaine . . .

More after the jump.

Existing-Home Sales Rise Again in March [4]
WASHINGTON (April 25, 2006)

Existing Home Sales  data [5]


Here’s another example of price cutting on New Home Sales:

25 new homes ready for move-in. 25 incredible
One weekend to see it all.
April 29, and Sunday, April 30, 10 a.m to 7 p.m.

The biggest homebuying event of the season is here! KB Home is holding open
houses at 25 new homes ready for move-in. Tour as many homes as you like and get
friendly, personalized service. With a variety of neighborhoods, styles, and
prices from the $300s, there’s incredible value waiting for every new

You’ll also get a $10 Target GiftCard just for stopping by. And if
you purchase a ready-for-move-in home during the KB Home 48-Hour House Hunt,
you’ll get a $1,000 Target GiftCard.

This amazing event features homes from 7 KB Home communities throughout the
greater Sacramento region. The homes are priced from the $300s, and many have
great features already built in, including:

• brand-name appliances

hardwood and tile flooring
• large kitchen islands
• master bath
• upgraded backyard landscaping

Don’t miss this opportunity to see all of our open houses in one weekend! For
detailed 48-Hour House Hunt listings, click here [6].

Participating KB Home communities include:
LIVE OAK — Oak Knoll

OLIVEHURST — River Glen [7]
LAKE — Cobblestone [8]
The Hamptons

SACRAMENTO — The Hamptons

SACRAMENTO — The Hamptons

YUBA CITY — Walnut Park

Spend a 1/2 million dollars, get a Target gift card!

Article printed from The Big Picture: http://www.ritholtz.com/blog

URL to article: http://www.ritholtz.com/blog/2006/04/existing-home-sales-data-california-real-estate-on-sale/

URLs in this post:

[1] monthly New Home Sales Data are unreliable: http://bigpicture.typepad.com/comments/2005/11/new_home_sales__1.html

[2] Image: http://www.ritholtz.com/blogjavascript:previousSlide();

[3] Image: http://www.ritholtz.com/blogjavascript:nextSlide();

[4] Existing-Home Sales Rise Again in March: http://www.realtor.org/PublicAffairsWeb.nsf/Pages/MarchEHS06?OpenDocument

[5] Existing Home Sales  data: http://www.realtor.org/Research.nsf/files/REL0603EHS.pdf/$FILE/REL0603EHS.pdf

[6] click here: http://lists.sacbee.com/t/1657060/4644481/154/0/

[7] River Glen: http://lists.sacbee.com/t/1657060/4644481/156/0/

[8] Cobblestone: http://lists.sacbee.com/t/1657060/4644481/157/0/

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