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Existing home sales decline for 10th month in a row
Existing home sales declined 7.7 percent in November to a seasonally-adjusted annualized rate of 4.1 million units, marking the 10th straight month of declining sales and a 35.4 percent decrease in sales compared to last year. NAFCU Economist Noah Yosif analyzes the data in the latest Macro Data Flash report.
“The median home price declined for a fifth straight month following typical seasonal patterns; however, year-over-year prices are still up by 3.5 percent,” said Yosif. “While mortgage rates peaked in November and have begun to retreat in recent weeks, their continued elevation above historic levels has hurt housing affordability, sidelining potential buyers, and reduced incentives for homeowners to list their properties, discouraging prospective sellers.”
Yosif also added that the National Association of Realtors observed that properties “typically remained on the market 24 days in November, 3 days longer than in October.”
“According to data from the US Bureau of Labor Statistics, there were 6.5 job seekers to every job available in July of 2009, but almost 2 jobs for every job seeker in the current environment, indicating disparities in labor supply and demand have bolstered wages which, in turn, has sustained demand for housing beyond levels seen during the Great Recession,” mentioned Yosif.
Sales fell in all four regions with a 12.5 percent decline in the West followed by the South (-7.1 percent), the Northeast (-7.0 percent), and the Midwest (-5.6 percent).
“Housing prices have been further supplemented by historically low inventory levels, as well as continued labor market growth, contributing to the brunt of the recent surge in inflation,” concluded Yosif. “Their continued cooling into the New Year could lead to a more robust pullback in inflation and persuade a more moderated monetary policy response from the Federal Reserve.”
For more economic updates from NAFCU's award-winning research team, view all of NAFCU's Macro Data Flash reports.