Existing Home Sales in Sept totaled 4.75mm annualized, right in line with expectations but down from 4.83mm in Aug. On a y/o/y basis, sales were up 11%. Single family home sales were lower by 80k from Aug but sales of condos/co-ops were unchanged. Because the amount of homes for sale fell by 80k to the lowest since March, the inventory to sales ratio fell to 5.9 from 6.0, the lowest since March ’06. Distressed sales made up 24% of overall sales vs 30% a yr ago as foreclosure sales are just 13% of that total, down from 18% in Sept ’11. Investors were 18% of the market, about in line with Aug ’12 and Sept ’11. The median home home price at $183,900 is up 11.3% y/o/y. Bottom line, the housing market continues to bounce off its extraordinarily depressed level and the difficulty in getting a mortgage is holding it back from being even better. The NAR Pres who’s a RE broker himself said “home buyers need to be more focused on the mortgage process in the current environment where lenders and banking regulators are being risk averse.” This said, as I did with housing starts, perspective is also necessary of what this recovery entails. With single family sales specifically at 4.21mm, they are back to where they were in 1998 and not too far from where they were in a temporary peak at the time in 1978. Also, while up 40% off the recent low in Aug’10, they’re still down 34% from the bubblicious highs in Sept ’05. Housing has bottomed but the recovery will be in more fits and starts rather than straight up, I believe.

Category: MacroNotes

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