NAR Stumped As Existing Home Sales Slide Continues; Lack Of Household Income Growth Blamed

After last month’s unexpected, dramatic 3.4% drop, and 1.64% Y/Y decline – the first annual decline since November 2015 – the weakness in exiting home sales continued today, when the NAR reported that in July sales of existing homes dropped another -0.9% from a downward revised 5.38MM to 5.33MM, missing expectations of a rebound to 5.45 million.
Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, declined 0.9 percent to a seasonally adjusted annual rate of 5.33 million in August from a downwardly revised 5.38 million in July. After last month’s decline, sales are at their second-lowest pace of 2016, but are still slightly higher (0.8 percent) than a year ago (5.29 million).
As the NAR reported, existing-home sales eased up in August for the second consecutive month despite mortgage rates near record lows as higher home prices and not enough inventory for sale kept some would-be buyers at bay. Only the Northeast region saw a monthly increase in closings in August, where inventory is currently more adequate. Some of the key details from the report: 4.6 months supply in Aug. vs. 4.7 in July. Inventory fell 3.3% to 2.04m homes. First time buyers comprised 31% of total sales; all cash were 22%; investors represented 13% while distressed sales were 5% of total sales

This post was published at Zero Hedge on Sep 22, 2016.