Best Data for October Existing Home Sales Since 2006 Draws Yawns.
This week is a light week for economic data. The weekly unemployment claims data will be released tomorrow, Wednesday, instead of its traditional Thursday release day. Today we received the Existing Home Sales Data. Last week this column produced an article titled "October Real Estate Forecast: Silver Linings" that projected strong new home construction - strong existing home sales data - and strengthening new home sales data. Last week the new construction data was better than expected. "October New Construction Data; Hammering ahead" detailed how we had the best single family starts data, the most units under construction for the month of October, and the most completions for the month of October since 2007. The best new construction data for the month of October during the past decade received a collective yawn. It was projected last week that we should see 450,000 to 460,000 units sold during October and that we should have set a new average sales price for the month of October. What happened?
Most Existing Units sold during October since October 2006. The number of units sold exceeded those sold during October 1999 through October 2001. The number of units sold were not quite at the 2002 pace of 481,000 units or the levels seen during October 2003, 2004, 2005, or 2006 when over over half a million units were sold. We had not cracked the 450,000 units level for the month of October during the past ten years.
New October Average Sales Price Record of $288,400. The forecast article had projected a range of $287,000 to $293,000. It is always challenging to project a record average sales price. People who were unable r unwilling to sell while prices were falling may be able to move this Spring.This is good news.
The Rolling Year Sales level is up 128,000 units from last year. This trailing indicator. The Realtors are saying that we have an annual rate of sale of 5.48M units and that this is down from last year's level. This is wrong. The RY data is at 5.51 million units and is up from last year's 5.386 million.
The Current Year data is up 62,000 units from last year. Last year we sold 5.452 million units. Last year we had sold 4.597 million units as of October. This year we have sold 4.659 million units. We are up 62,000 units year to date. If we add that 62,000 units to last year's level then we will hit 5.516 million units. We can still hit the levels recorded during 2002 if we exceed 5.633 million units.
The inventory level is the lowest for the month of October since 1999. There were only 1.800 million units available during October. This level is lower than last year's 2.010 million units and lower than the 1.950 million units available during October of 2000. We have less than half the inventory that was available during October 2007 as the economic crisis was beginning. Remember that we had peak units sold during 2005. We saw peak, pre-recession, average sales prices during 2006. The Peak jobs market was July 2007. It is important t note that this data only reached back as far as January 1999.
All of the data indicates a strengthening housing market. If the media was more interested in sales than salacious stories this would be garnering lead story status on every station. The most October units sold since October 2006. Yawn. Record Average Sales Price. Yawn. Seriously low inventory levels. Yawn. No go get ready at someone's house for more yawning after the tryptophan kicks into overdrive.
It's the economy.
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