Interest Rate Roundup

Wednesday, July 20, 2011

Existing home sales slip in June

In the wake of yesterday's strong housing starts report, there was some optimism that sales would pick up as well. But did they? Not in the existing home arena. Sales slipped 0.8% in June to a seasonally adjusted annual rate of 4.77 million units from 4.81 million a month earlier. That missed forecasts for a pick up to 4.9 million and was the lowest level for sales since November.

By property type, single family sales were flat while condo and coop sales dropped 7%. The months supply at current sales pace indicator of inventory rose to 9.5 from 9.1, while the raw number of homes for sale also climbed -- to 3.765 million from 3.646 million a month prior. That is down more than 3% from a year earlier, however.

The median price of a new home rose to $184,300 from $169,300 a month earlier. That was up 0.8% from a year earlier and interestingly enough, the highest since October 2008.

It looks like a bit of a mixed bag of news on the housing front - par for the course in this market! Sales slumped to the lowest level in seven months, and the supply of homes for sale remained ample. Yet the price of the homes that did sell rose again, touching the highest in a couple of years. It's tough to see that holding up with disappointing sales volume, and the high level of cancellations. But it's worth noting.

Going forward, it's all about the job market. If we start consistently creating jobs in this country, housing will recover. If we don't, it won't. Sure it sounds simple. But it has the added benefit of being true.


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