Existing home sales rose 1.3 percent. Tack on a small positive revision, and sales rose 1.5 percent from the previous report. Year-over-year sales are still negative.
Sales are down 37.7 percent from the January 2022 high and 2.6 percent above the October 2023 low (yellow highlights).
Skid Ends (For Now)
The NAR reports Existing-Home Sales Advanced 1.3% in July, Ending Four-Month Skid.
Five Key Highlights
- Existing-home sales grew 1.3% in July to a seasonally adjusted annual rate of 3.95 million, stopping a four-month sales decline that began in March. However, sales slipped 2.5% from one year ago.
- The median existing-home sales price elevated 4.2% from July 2023 to $422,600, the 13th consecutive month of year-over-year price gains. All four U.S. regions posted price increases.
- Total housing inventory registered at the end of July was 1.33 million units, up 0.8% from June and 19.8% from one year ago (1.11 million). Unsold inventory sits at a 4.0-month supply at the current sales pace, down from 4.1 months in June but up from 3.3 months in July 2023.
- First-time buyers were responsible for 29% of sales in July, identical to June but down from 30% in July 2023.
- All-cash sales accounted for 27% of transactions in July, down from 28% in June but up from 26% one year ago. Individual investors or second-home buyers, who make up many cash sales, purchased 13% of homes in July, down from 16% in both June 2024 and July 2023.
Existing-Home Sales Percent Change from Month Ago
Existing-Home Sales Supply
Supply is slowly stair stepping higher.
Last month, supply was the highest in over four years.
Existing-Home Sales Percent Change from Year Ago
Sales were falling so fast that year-over-year numbers were increasingly easy to beat. But things reversed lower after getting to -1.7 percent year-over-year.
From a year ago sales are down 2.5 percent. Sales are down 37.7 percent from the January 2022 high.
Existing-Home Sales 1968-Present
I repeated last months chart. The July 2024 sales are 3.95K.
Existing-home sales are below the level of December 1995 and also May 1979.
Adjusted for population, these are abysmal numbers.
Never has a housing market fallen this much from its cycle peak without a recession occurring, so I interpret the latest report as a normal blip in a larger downtrend that has not completed. Will the Fed use this report to justify keeping rates high?
sold home in July(closed)
had 8% MORTGAGE concession to buy down interest rate
1 down another in escrow
AAPL might rise > the cloud to close Jul 16/17 gap. The regional banks [1W] might break out after a rate cut.
As expected. August likely sees a more visible uptick, with the following caveats.
1. Potential interest rate cuts have been prominent headlines. Your average home buyer has no clue how bond market works, and likely considering stalling making an offer until rates drop. For those here interested in bonds, the current rate is about as low as they can go unless r* is lower to much lower than current consensus long run r*, spreads tighten, or term premium becomes a thing of the past. Either is possible, as is bond market overshoot. Many Bond people have gone from the rational, long view adults in the room to hyperventilating fintwit fanatics.
2. RE listing price cuts are starting to stack up. People seeing this may logically conclude that it’s best to wait for better value to show up.
We could be on the verge of the long anticipated residential RE correction, but I personally feel pent up demand and animal spirits will keep things firmer, even if prices do fall.
-Jeremy
I had been waiting for bad news from Home Depot and Lowe’s, and it came last week. Their revenues and income are tied to home sales for obvious reasons.
True but homebuilders have strong sales and backlog. During HB1, homebuilders started seeing sales drop in 2007 which was 2 years before the recession.
1) The boomers approach eighty. Within a few years there will be a few of them. They follow the silent gen : 78% homeownership with a dwindling numbers.
Gen alpha is 30/40 millions short of the boomers. There are not enough of them to increase RE demand. Kamala Harris plans to build 3,000,000 housing units in the flyover and in the suburbs. The boomers wouldn’t sell. Their assets are collateral for healthcare and pharma. The sticky inflation might deflate their assets. The housing market might not recover if we enter recession.
2) Covid challenged researchers. Pharma fake scientists fight them. Dr Tom Borody injected good faecal microbioms through people azzz, who suffered from Crohn disease. This is an inexpensive standard anal transfer. When Dr Borody suggested a treatment of good Faecal Microbiotica Transplant (FMT) and a good bugs bank to save the impaired. A few scientist who dared are working on a “Mucosal System” that flow from the tongue to the gut and from there to the brain and the lungs. Saliva is bad for pharma. Dr Nathan Bryan leads the research in the US.
The oldest boomers are approaching 80, the youngest are still two years away from early retirement. The population is dropping, but the peak rate of decline is still 15 years out.
So, sales are on the way up now that mortgage rates are dropping. Imagine that?
I’ll be ROTFLMAO if the Fed get’s this one wrong, drops by 25 BP, then housing starts to move even higher, durable goods recover some, and inflation plateaus throughout the rest of the year and then turns north by March 2025.
Looking at all 5 criteria, we are not in a recession yet. For a lot of people, it sure seems like a recession, but it’s just not there YET. Let’s see what initial August GDP looks like along with the jobs number, and this should give us an idea if we’re trending down or holding steady.
My bet is the later.
Yes We Can!
Can what? (sarc)