Existing Home Sales Hold Up Nicely In December - January 23, 2014
The National Association of Realtors (NAR) reported earlier this morning that sales of existing homes had ticked up last month, and that transactions for all of 2013 had reached their highest level in seven years.
All told, existing home sales, including transactions involving single-family homes, townhouses, condominiums, and co-ops rose 1.0 percent 4.87 million units. That compared with a downwardly revised November home sales total of 4.82 million residences. The consensus expectation had been for the sale of 4.95 million homes in December.
For all of 2013, there were 5.09 million homes sold. That represented a gain of just over 9% for the full year. That was the best showing since 2006 when sales had totaled 6.48 million units. That had been during the housing bubble days; volume subsequently collapsed in 2008 and 2009.
Lawrence Yun, the Chief Economist of the NAR noted that "housing has experienced a healthy recovery over the past two years. Existing home sales have risen nearly 20 percent since 2011, with job growth, record low mortgage rates, and large pent-up demand driving the market." Clearly, this latest report, albeit not a stellar one, did nothing to alter this brightening overall housing picture.
Meanwhile, prices rose last year, with the median price for a home climbing to the highest level since 2005. Also, total inventories fell to just a 4.6 month supply, which is below the six-month level normally considered healthy. In fact, we sense, that only such low inventories are keeping home sales from being even stronger.
All in all, this was a solid report, and one that does not change the brighter aggregate picture in this critical industry. Indeed, we believe that 2014 will be yet one more year in this sector's impressive recovery.
At the time of this article's writing, the author did not have positions in any of the companies mentioned.