Mixed Messages ~ June 28, 2019
It's rare when all three home sales reports are published in the same week but when they are, the overall picture they paint is often about as clear as pond water. Existing sales were, for a change, pretty good, rising 2.5% from April, the first gain in three months. The sales of 5.34 million units, again failed to improve on an annual basis (down by 1.1%). Maybe we should call this a tradition; the last time existing sales were higher year-over-year was February 2018.
Pending sales also reversed course after declining slightly in April, posting a 1.1% gain, about what was expected given the low interest rates and slowing price appreciation. The Pending Home Sale Index remains stubbornly lower on an annual basis however, down 0.7% and scoring its 17th consecutive year-over-year loss.
The third, the report on new home sales in May, provided more fuel for the already hot discussions about the direction of the housing market. New sales had performed better than those for existing homes for much of the year, increasing in each of the first three months. April broke the streak and May followed suit. New homes sold at a seasonally adjusted annual rate of 626,000 units, a 7.8% downturn on top of the 6.9% loss in April. And, need we say, those sales were down year-over-year as well, by 3.7%.
While the number of new homes available for sale barely budged from the April total, dwindling sales did drive the monthly supply higher, from 5.9 months in April to 6.4 months. Prices slipped too; the median price of a home sold nationally in May was $308,000 compared to $316,700 a year earlier.
While home prices are still increasing for home sales in general--moderation,according to a Case-Shiller spokesperson, is the word of the month. The S&P Case-Shiller National Index's monthly increase was higher in March than in February, typical at the start of the spring housing market, but the annual increase declined from 3.7% to 3.5%.
The Federal Housing Finance Agency's Home Price Index continues to show a faster rate of appreciation than others. It was up 0.4% in March reflecting annual gains of more than 5%.