Steel Markets

Existing Home Sales at Highest Pace Since February 2007

December 21, 2016

Existing-home sales surged in the Northeast pushing existing home sales to a seasonally adjusted annual rate of 5.61 million from a downward revised 5.57 million in October. The 0.7 percent increase put November’s sales pace at its highest since February 2007 and 15.4 percent higher than November 2015.

Lawrence Yun, NAR chief economist, says it’s been an outstanding three-month stretch for the housing market as 2016 nears the finish line. “The healthiest job market since the Great Recession and the anticipation of some buyers to close on a home before mortgage rates accurately rose from their historically low level have combined to drive sales higher in recent months,” he said. “Furthermore, it’s no coincidence that home shoppers in the Northeast — where price growth has been tame all year — had the most success last month.”

Median price for existing-home sales rose 6.8 percent y/y to $234,900 for the 57th consecutive increase.

Inventory continues to be tight, falling 8 percent to 1.85 million homes for sale, down 9.3 percent from year ago levels. Supply of inventory, at the current sales pace, decreased to 4.0 months from 4.3 months in October.

“Existing housing supply at the beginning of the year was inadequate and is now even worse heading into 2017,” added Yun. “Rental units are also seeing this shortage. As a result, both home prices and rents continue to far outstrip incomes in much of the country.”

Single-family home sales fell 0.4 percent in November to a SAAR of 4.95 million. Compared to a year ago, the median price was up 6.8 percent to $236,500.

Condo and Co-op sales surged 10.0 percent to a SAAR of 660,000 units. Median condo prices rose 5.8 percent y/y to $222,600.

The National Association of Realtors regional breakdown follows:

November existing-home sales in the Northeast hiked 8.0 percent to an annual rate of 810,000, and are now 15.7 percent above a year ago. The median price in the Northeast was $263,000, which is 3.3 percent above November 2015.
In the Midwest, existing-home sales decreased 2.2 percent to an annual rate of 1.33 million in November, but are still 18.8 percent above a year ago. The median price in the Midwest was $180,300, up 6.5 percent from a year ago.
Existing-home sales in the South in November rose 1.4 percent to an annual rate of 2.22 million, and are now 11.6 percent above November 2015. The median price in the South was $206,900, up 9.2 percent from a year ago.
Existing-home sales in the West declined 1.6 percent to an annual rate of 1.25 million in November, but are still 19.0 percent higher than a year ago. The median price in the West was $345,400, up 8.5 percent from November 2015.