Sunday, June 25, 2017

May's new and existing home sales

the only widely watched reports released over the past week were the May report on new home sales from the Census bureau and the May report on existing home sales from the National Association of Realtors (NAR)....in addition, this week also saw the release of the Kansas City Fed manufacturing survey for June, covering western Missouri, Colorado, Kansas, Nebraska, Oklahoma, Wyoming and northern New Mexico…they reported their broadest composite index rose to +11 in June, up from +8 in May and +7 in April, suggesting a steady expansion of manufacturing in the 10th District...

May’s New Homes Sales and Prices Might Have Been Higher Than April’s

the Census report on New Residential Sales for May (pdf) estimated that new single family homes were selling at a seasonally adjusted pace of 610,000 homes annually during the month, which was 2.9 percent (±13.0 percent)* above the revised April rate of 593,000 new single family homes a year and 8.9 percent (±21.9 percent)* above the estimated annual rate that new homes were selling at in May of last year....the asterisks indicate that based on their small sampling, Census could not be certain whether May new home sales rose or fell from those of April or even from those in May a year ago, with the figures in parenthesis representing the 90% confidence range for reported data in this report, which has the largest margin of error and is subject to the largest revisions of any census construction series....hence, these initial new home sales reports are not very reliable and often see significant revisions...with this report; sales new single family homes in April were revised from the annual rate of 569,000 reported last month to a 593,000 a year rate, March's annualized home sale rate, initially reported at 621,000, was revised from last months upward revision of 642,000 to 644,000, while the annual rate of February's sales, revised from 592,000 to an annual rate of 587,000 last month, were again revised higher, to an annual rate of 615,000...

the annual rates of sales reported here are extrapolated from the estimates of canvassing Census field reps, which indicated that approximately 58,000 new single family homes sold in May, up from the 57,000 new homes that sold in April, but down from the 61,000 new homes that sold in March....the raw numbers from Census field agents further estimated that the median sales price of new houses sold in May was a record $345,800, up from the median sales price of $310,200 in April, while the average May new home sales price was $406,400, also a record high, up from a $367,700 average in April, and up from the average sales price of $350,000 in May a year ago....a seasonally adjusted estimate of 268,000 new single family houses remained for sale at the end of May, which represents a 5.3 month supply at the May sales rate, down from a 5.7 month supply in April....for more details and graphics on this report, see Bill McBride's two posts, New Home Sales increase to 610,000 Annual Rate in May and A few Comments on May New Home Sales...

Existing Home Sales Rose 1.1% in May

the National Association of Realtors (NAR) reported that seasonally adjusted existing home sales rose by 1.1% from April to May, projecting that 5.62 million homes would sell over an entire year if the May home sales pace were extrapolated over that year, a pace that was also 2.7% greater than the annual sales rate projected in May of a year ago...that came after an annual sales rate of 5.56 million homes in April, which was revised from the originally reported 5.57 million annual sales rate, and an annual home sales rate of 5.70 million in March...the NAR also reported that the median sales price for all existing-home types in May was $252,800, which topped the prior record $247,600 median price set last June and was 5.8% higher than a year earlier, which they report is "the 63rd straight month of year-over-year gains"......the NAR press release, which is titled Existing-Home Sales Rise 1.1 Percent in May; Median Sales Price Ascends to New High, is in easy to read plain English, so if you're interested in the details on housing inventories, cash sales, distressed sales, first time home buyers, etc., you can easily find them in that press release...as sales of existing properties do not add to our national output, neither these home sales nor the prices for which these homes sell are included in GDP, except insofar as real estate, local government and banking services are rendered during the selling process…

since this report is entirely seasonally adjusted and at a not very informative annual rate, we usually look at the raw data overview (pdf), which gives us a close approximation to the actual number of homes that sold each month...this data indicates that roughly 555,000 homes sold in May, up by 24.2% from the 447,000 homes that sold in April and 5.7% more than the 525,000 homes that sold in May of last year, so we can see there was again a seasonal adjustment in the annualized published figures of over 23% to correct for the typical springtime increase in home sales...that same pdf indicates that the median home selling price for all housing types rose 3.2%, from a revised $245,000 in April to $252,800 in May, while the average home sales price was $294,600, up 2.4% from the $287,800 average in April, and up 4.9% from the $280,900 average home sales price of May a year ago, with the regional average home sales prices ranging from a low of $235,100 in the Midwest to a high of $389,700 in the West...for additional coverage with long term graphs on this report, see "NAR: "Existing-Home Sales Rise 1.1 Percent in May"" and "A Few Comments on May Existing Home Sales" from Bill McBride at Calculated Risk...

 

(the above is the synopsis that accompanied my regular sunday morning links emailing, which in turn was mostly selected from my weekly blog post on the global glass onion…if you’d be interested in receiving my weekly emailing of selected links, most from the aforementioned GGO posts, contact me…)

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