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Existing Home Sales Skid Another 3.4 Percent in May, Down Fourth Month

Existing home sales declined for the fourth month. Sales are down 16.8 percent since January.
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Existing home sales courtesy of Trading Economics annotations by Mish

Existing home sales courtesy of Trading Economics annotations by Mish

The National Association of Realtors reports Existing-Home Sales Fell 3.4% in May; Median Sales Price Surpasses $400,000 for the First Time.

Report Highlights

  • Existing-home sales fell for the fourth straight month to a seasonally adjusted annual rate of 5.41 million.
  • Sales were down 3.4% from the prior month and 8.6% from one year ago.
  • The inventory of unsold existing homes climbed to 1.16 million, or the equivalent of 2.6 months of the monthly sales pace.
  • The median existing-home price for all housing types in May was $407,600, up 14.8% from May 2021 ($355,000), as prices increased in all regions. The median price exceeded $400,000 for the first time.
  • This marks 123 consecutive months of year-over-year increases, the longest-running streak on record.
  • All-cash sales accounted for 25% of transactions in May, down from 26% in April and up from 23% recorded in May 2021.
  • Individual investors or second-home buyers, who make up many cash sales, purchased 16% of homes in May, down from 17% in April and 17% in May 2021.

Average Mortgage Rates 

  • According to Freddie Mac, the average commitment rate for a 30-year, conventional, fixed-rate mortgage was 5.23% in May. 
  • According to Freddie Mac, the annual average commitment rate across all of 2021 was 2.96%.
  • Mortgage News Daily (MND) shows the average current rate is 6.11%. 
  • MND shows the rate on January 3, 2022 was 3.41%.

Mortgage rates have doubled the average for 2021 and have risen 2.7 percentage points this year.

The NAR's PowerPoint Presentation has many interesting charts worth a review.

Median Price of Existing Home Sales

Median price of Existing home sales 2022-05

Percent Change of Existing Home Sales by Price Range

Percent Change in Sals Year-Over-Year by Price Range NAR 2022-05

Year-Over-Year Percent Change of Existing Home Sales

Total Existing Home Sales Percent Change Year-Over-Year 2022-05

Key Chart Ideas

  • Year-over-year sales are down 10 consecutive months.
  • Sales of homes over $500,000 are up, below $500,000 down
  • The median price of sales continues to rise and hit a new record
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Econoday Consensus

Existing Home Sales - Bloomberg Econoday Predictions 2022-05

Last month, one economist predicted a 4 percent rise in sales. What was that person's thought process?

This month, the consensus was spot on. 

The median prices is still rising (for now). That will not last long as sellers are rapidly dropping their ask price.

Bust Just Getting Started

Existing home sales courtesy of Trading Economics annotations by Mish

Existing home sales courtesy of Trading Economics annotations by Mish

Existing home sales are recorded at closing, new homes at signing. May sales reflect March and April's mortgage rates, not June's.

Seventh Largest US Importer Cuts Shipments in Half, Shipping Rates Crash

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With mortgage rates up 2.7 percentage points this year and doubling from a year ago, this bust is just getting started and with it the demand for goods.

This post originated at MishTalk.Com.

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