Existing Home Sales

Home sales fell for the third straight month this year as home prices continue to rise at a record pace. Existing home sales fell 2.7% to a seasonally adjusted 5.58 million in April, from a month earlier, according to the National Association of Realtors (NAR). The results missed analyst expectations of a 1% gain, according to Bloomberg consensus. April sales activity was up 33.9% from the same month a year earlier when the nation was under a lockdown due to the coronavirus pandemic. Compared to April 2018, existing home sales was up 11%. Sales activity in all but one of the four regions in the U.S. — the Midwest — fell. Only the Midwest, where homes are more affordable, recorded a gain of 0.8% from a month earlier, according to the NAR.

"Low inventory continues to hinder sales activity," said Lawrence Yun, NAR chief economist, during a press call prior to the release of the results, adding that despite the slowdown in activity the housing market is still "hot."

The median existing-home price for all housing types in April was $341,600, up 19.1% from April 2020, as every region recorded price increases. This is a record high (the NAR started tracking prices in 1999) and marks 110 straight months of year-over-year gains.

"Despite the decline [in sales], housing demand is still strong compared to one year ago, evidenced by home sales from this January to April, which are up 20% compared to 2020,” Yun said. “The additional supply projected for the market should cool down the torrid pace of price appreciation later in the year.”

Total housing inventory at the end of April was 1.16 million units, down 20.5% from one year ago — the lowest level since NAR started tracking homes for sale in 2011. The good news is inventory is up 10.5% from March, an indication that homebuilding is picking up.

Unsold inventory sits at a 2.4-month supply at the current sales pace, slightly up from March’s 2.1-month supply and down from the 4-month supply recorded in April 2020. These numbers continue to represent near-record lows. NAR first began tracking the single-family home supply in 1982.

Source: Yahoo Finance