After three months of increases, sale took a big dive in January.
The NAR reports Existing-Home Sales Decreased 4.9% in January, But Increased Year-Over-Year for Fourth Consecutive Month
Five Key Highlights
- Existing-home sales fell 4.9% month-over-month to a seasonally adjusted rate of 4.08 million in January 2025.
- Year-over-year, sales improved 2.0%.
- Sales are down 35.6 percent from cycle high of 6.34 million in January of 2022.
- The median existing-home sales price advanced 4.8% from January 2024 to $396,900, the 19th consecutive month of year-over-year price increases.
- The inventory of unsold existing homes grew 3.5% from the prior month to 1.18 million at the end of January, or the equivalent of 3.5 months’ supply at the current monthly sales pace.
The Bloomberg Econoday consensus was 4.16 million.
Existing-Home Sales Percent Change from year Ago
Due to a hard comparison in February, I expect sales to go negative again next month.
Long-Term Perspective
Existing-home sales are about where they were in November of 1978.
Existing-Home Sales Supply
Despite seasonal adjustments, the data sows strong seasonal tendencies. This implies faulty seasonal adjustments.
Related Posts
January 24, 2025: For the Full Year, 2024 Existing-Home Sales Lowest in Nearly 30 Years
February 10, 2025: Renters Are Tired of Moving, Settling in for the Long Haul
February 18, 2025: NAHB Housing Sentiment Flounders, the Market Needs Lower Mortgage Rates
February 18, 2025: Housing Starts Drop 9.8 Percent, Unable to Retain Any Traction
The Fed has never considered home prices to be a part of inflation stats. It wrecked the market in those beliefs.
There is no easy way for the Fed to rectify its mistakes.
Let me guess … this is still Biden’s fault.
The upcoming recession will force overextended borrowers to sell their 2nd, 3rd, 4th….homes.
Can we please add a x 10^-1 to percent?
Near 50% sounds a lot better for falling home prices.
Sadly, four weeks of Trump cannot undo four years of Biden.
Yeah, crazy, disposable income (adjusted for inflation) went up the whole time. Credit delinquencies were low. Stocks went up. More energy produced than in Trump 1.0 years. My own net worth is much multiplied since start of 2020. Such woes.
The serfs got fat and sassy under Biden, but an economic crash will fix that. Patience… all is proceeding to plan.
Everyday Trump does his best to bring on the next recession. The fallout from tariffs, mass layoffs, inflation and trade wars is going to hurt everyone.
We’ll actually be seeing the poor starve in the streets, rather than lounging luxuriously in their tents on their cardboard beds.
The “Christians” are on board. Let’s roll.
Wait until aged grandma loses her Medi-Cal long-term care support and shows up, diseased, at your door. And the medical bill when the low-income offspring get sick. Winning! But the new yachts will be beautiful this year.
Where are all the selfless Healthcare Heroes from 4-5 years ago? Line dancing?
The corruption and lack of common sense of both the Republicans and the Democrats (the Uniparty) are to blame for the current sick state. The debasement of the value of US dollar to create artifcially cheap debt led to much malinvestment such as bubble assets, a lack of confidence in govt, huge debt burden for the future from perpetual overspending.
Could it be that many people are happy where they live and their mortgage situation, especially lack thereof? There was never a better time to set that up than 2020 – 2022 Covid Theater.
Prices will go down when Fanny and Freddie lower their maximums – or disappear completely.
Messed up so badly that despite my wanting to move and/or buy a second home for retirement, I cannot afford to pay the prices that refuse to go down. In the chart we saw prices drop with the housing bubble 1.0 crash but in housing/everything bubble 2.0 prices have gone up. So I guess I tough out a few more winters.
Sellers are reluctant to lower prices The Fed has conveyed the message that interest rates are high to combat inflation and will be lowered when the statistics reflect lower prices.
Looking at the historical chart, it’s difficult to make the argument that rates are high especially against the backdrop of how much money has been created.
For more than a decade, the Fed held rates at zero while setting a 2% inflation target which was essentially a mandate for everyone to spend or buy assets or face a 2% inflation penalty on their cash holdings. The penalty was much higher for first-time home buyers.
This type of financial repression is a very powerful motivator. Investors are leery of being caught on the wrong side of the Fed mandate and may be content with holding onto their properties in hopes of higher prices.
Thus, there is currently somewhat of a stalemate between buyers and sellers.
We’d have a more balance economy if home prices rose more in tandem with middle-class wages instead of being juiced higher by Fed puts and mandates.
https://www.statista.com/statistics/187616/effective-rate-of-us-federal-funds-monthly/
what is the Elon Musk long term? https://x.com/TylerAlterman/status/1892768782310932788
Supply is constrained because people don’t want to give up their 2.75% mortgage for a 6.75% mortgage. The reaction to Covid was over the top – financially, medically, socially and in every way.
Well put.The overreaction left us a mess on so many levels.
Going to take a decade or so to fully wind through the system.
This year and the next is all about used cars and the fact that so few were made in 2020-2022 so there is going to be a spike in price in the same way there was on new cars in those years. That’s going to push up inflation numbers bigly.
Hopefully during the Trump administration, the manufacturers can build a bunch of moderately priced internal combustion cars that people can buy for years after the communists are back in power.
I sure hope so! These overbuilt and overpriced joke machines make me sick.
Supply is also constrained because investors flooded into the market beginning in 2020. What is important is the supply to demand dynamic. Lowering mortgage rates to 2.75% isn’t going to improve that as the seller becomes the new demand. Incentivizing investors to sell (through higher rates?) would improve the supply/demand ratio.
Don’t forget Congressionally with all that rent & mortgage relief.
Fed fucked housing for a decade or more imo. Yup
And don’t forget Congress with rent & mortgage relief.