EXISTING-HOME SALES DOWN YOY, BUT MONTHLY INCREASES SHOW LOW INVENTORY NOT HOLDING BUYERS BACK
Existing-home sales, recording a seasonally adjusted annual rate of 6.34 million in October, bumped down 5.8% compared to last year, according to the latest data from the National Association of REALTORS® (NAR). While they’re lagging behind on a yearly basis, consistent monthly increases show home sales remain relatively stable despite continued challenges impacting affordability, such as low inventory.
Single-family home sales increased to a seasonally adjusted annual rate of 5.66 million in October, up 1.3% from 5.59 million in September and down 5.8% YoY.
Existing condo and co-op sales posted a seasonally adjusted annual rate of 680,000 units in October, down 2.9% from 700,000 in September and down 5.6% YoY.
By Region:
Regionally, all areas posted year-over-year-declines, with the Northeast seeing the largest downward trend.
Midwest
Existing-Home Sales: 1.5 million (-6.3% YoY)
Median Price: $259,800 (+7.8% YoY)
Northeast
Existing-Home Sales: 750,000 (-13.8% YoY)
Median Price: $379,100 (+6.4% YoY)
South
Existing-Home Sales: 2.78 million (-3.5% YoY)
Median Price: $315,500 (+16.1% YoY)
West
Existing-Home Sales: 1.31 million (-5.1% YoY)
Median Price: $507,200 (+7.7% YoY)
What it means:
“Home sales remain resilient, despite low inventory and increasing affordability challenges. Inflationary pressures, such as fast-rising rents and increasing consumer prices, may have some prospective buyers seeking the protection of a fixed, consistent mortgage payment.
“Among some of the workforce, there is an ongoing trend of flexibility to work anywhere, and this has contributed to an increase in sales in some parts of the country. Record-high stock markets and all-time high home prices have worked to significantly raise total consumer wealth and, when coupled with extended remote work flexibility, elevated housing demand in vacation regions.” — Lawrence Yun, NAR Chief Economist
“At a time when mortgage rates are still low, buying and securing a home is a wise investment. NAR will strive to make homeownership obtainable for all who want to pursue one of the key components of the American Dream.” — Leslie Rouda Smith, NAR President
“It was positive news that home sales increased for the second month in a row and at the fastest pace of sales since January 2021. Similar to MBA’s recent weekly data on purchase mortgage applications, home sales are still running below last year’s elevated pace but have shown some renewed strength recently.
“Inventory declined to 1.25 million homes for sale, reiterating the need for more for-sale units from both homeowners listing their homes for sale, and the construction of new homes, to supplement and replenish the country’s aging housing stock. The median sales price picked up again after three monthly declines and was 13% higher than a year ago. The housing market heading into 2022 is still feeling the effects of a persistent supply and demand imbalance.” — Joel Kan, Mortgage Bankers Association AVP of Economic and Industry Forecasting
“One year ago marked a peak of existing-home sales activity as the combination of necessity and opportunity drove many Americans to search for housing at a time of year that does not typically see a frenzied level of buyers in the market. Although existing-home sales have eased back from that peak, activity remains notably above recent annual totals, reflecting demand from a large number of young households at prime first-time home-buying ages. With more workplace flexibility enabling home shoppers to broaden their search areas and potentially increase their chance of success, we continue to see historically-high levels of existing home sales. Additionally, the sales pace could begin to pick up as still-eager buyers potentially see more newly-listed homes, with the majority of prospective sellers planning to enter the market within the next six months.” — Danielle Hale, realtor.com® Chief Economist