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USA existing-home sales fall in October
Posted On Nov 23 2015
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Total existing home sales fell 3.4% to a seasonally adjusted annual rate of 5.36 million in October from 5.55 million in September. Affordability, driven by tight supply, is restraining demand. At the same time, steady employment growth, rising rents and low borrowing costs are bolstering prospects for the market. Still, “job growth has been pretty strong – that’s very supportive”. Economists surveyed by the Wall Street… Estimates ranged from 5.09 million to 5.6 million. Unsold inventory is at a 4.8-month supply at the current sales pace, up from 4.7 months in September. The supply of existing homes was 4.5% lower at the end of October, compared to the same period a year ago.
The average, 30-year fixed mortgage rate has risen to just a hair under 4 percent from 3.79 percent a month ago, according to mortgage buyer Freddie Mac. They were 9 percent a year ago. The number of previously owned homes for sale dropped 2.3 percent in October from a month earlier to 2.14 million, the fewest since March.
But last month suggested the start of a backlash. Yun said he forecasts 5.3 million homes will be sold in 2015, the most in eight years. “Once we reach the spring buying season we may be faced with an inventory crunch”. Realtors consider 5.5 months of inventory a balanced market favoring neither buyer nor seller and an indicator of favorable conditions for new home construction.
The housing market has been relatively robust in many markets across the country.
Sales in the Northeast were unchanged, the Midwest posted a 0.8 percent sales decline, the South’s sales fell 3.2 percent and the West’s dropped 8.7 percent. Sales of multi-family homes fell 1.6% in October at a seasonally adjusted annual rate of 610,000 units. That compares with a 260,000 past year that was the best since 1999.
Sales were up 3.9 percent from a year ago and sales held above their average for the year.
After reporting a sharp jump in US existing home sales in the previous month, the National Association of Realtors released a report on Monday showing that existing home sales pulled back by a little more than expected in October.
