Another Monthly Record Average Sales Price
The August Real Estate forecast article projected that we could see Expect a number under 549,000 units and over 532,000, or roughly 541,000 units sold this month, combined condominiums and single family houses, that we could see average sales price between $303,000 and $309,000, and that inventory between 1.87 million and 1.95 million units, most likely lower than 1.9 million units. The lack of inventory since December of 2015 has been slowing sales. What was reported in the REALTORS August Real Estate Sales Article? They say sales were flat. It looks better than that.
The Total Number of Units Sold was up from August 2017. Units sold edged slightly higher to 539,000 units from the August 20017 level of 535,000 units. This level of sales is identical to what was recorded, non-seasonally adjusted, during August of 2016. This is better than we were doing during August of 1999 and August of 2000. This was on the high side of what was expected.
The Average Sales Price broke through the $300,000 level, again. The Average sales price was above $300,000 during May, June, and July of this year. The sales price is up from $294,400 during August of 2017 and up from $282,000 during August of 2016. The Average sales prices was under $270,000 prior to the housing recession. This should be good news for people who have bought homes who need to move, or who want to move. It was anticipated that we would set an August record. This was on the low side of expectations at $303,200. It was still within expectations.
Inventory Stabilized at 1.92 million units. We have had fewer than 2.0 million total units for sale since October of 2016. We had been setting "Current Month" record lows almost every month since that time, with fewer than 1.5 million units available during December of 2017. No change is good news. The inventory was within expectations, and in some ways better than expected. Will we get above 2 million units anytime soon? Time will tell. It may not be until April, May, or June of 2019.
Current Year Sales are trending toward 5.48 million units. The official REALTOR number is 5.340 million units, down from August 2017 and 5.42 million units. We sold 5.452 million units throughout 2016 and 5.511 million units throughout 2017. The REALTOR number of 80,000 units lower than 2017 would peg 2018 at roughly 5.43 million units.
The Rolling Year data is also lower than 2017 and Better than 2016. The rolling year data is the trailing 12 months of data. We had 5.525 million units during August of 2017 and sold 5.511 million by years end. We had 5.370 million units during August 2016 and sold 5.452 million units. This year we are at 5.464 million units. The rolling year data is slightly lower than the current year data which indicates that the existing home sales data is picking up the pace of sales.
It does not appear hat we will beat the 2017 sales level, and that is okay. The amount of homes that is sold is contingent upon the inventory level. The REALTORS are indicating that we are doing slightly better than we were during August of 2017, and considerably better than we were doing during December of 2017. We are roughly at the same point in the rolling year cycle as we were during August of 2002. Sales accelerated through October of 2005 before units sold slowed and the average sales price climbed. The pre-recession average sales price peaked almost exactly one year later. A pace of sales between 5.5 million and 5.75 million units a year may be maintainable once it has been achieved. Full-time jobs have been at current month record levels for the entire year. January was better than January 2017, February was better than February 2017, all the way up to August. You generally need full-time jobs to qualify for a mortgage. If people feel confident that they can place their homes on the market and find another home to purchase, then this market will continue to grow.
It is important to understand that all real estate is local. Sales prices are determined by buyers who want to buy and sellers who want to sell. If buyers have to buy, prices will spike higher. If sellers have to sell, they will sell for less than the market value. Sales prices are determined by location, condition, and motivation. Prices vary by state, county, city, neighborhood, and style of home or condominium. Some years one neighborhood or school district is hotter than the prior year or the following year. Consult a REALTOR if you are thinking of selling. Just because the average sales price for the country s over $300,000 does not mean that this is what your home or condominium can expect. Just because the days on market is rising does not mean that you will sell within the next 90 to120 days. You might sell faster than this and you may sell slower than this. The average sales price is up 3% from August 2017, and this reconciles with the Consumer Price Index (CPI) data for Shelter costs. This was a good report.
It's the economy.
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