Dennis Norman
According to the latest report from the National Association of REALTORS(R), existing home sales in the US in March increased 6.8 percent to a seasonally adjusted-annual rate of 5.35 million units in March from a revised level of 5.01 million units in February, and increased 16.1 percent from a year ago when the rate was 4.61 million units (seasonally adjusted).
Prices on the rise -
The median home price in the U.S. in March was $170,700 an increase of 3.7 percent from February’s $164,600 and an increase of 0.4 percent from a year ago when the median price was $170,000.
Inventories on the decline-
Well sort of…The inventory of existing homes for sale in March actually increased 1.5 percent from the month before but, due to the increased rate of home sales, the “months supply” of homes decreased from 8.5 months to 8.0 months in March representing a decline of 5.9 percent for the month and a decline of 15.8 percent from a year ago when there was 9.5 months supply of existing homes for sale.
Local Hot Spots -
NAR publishes existing home sales for 20 major metropolitan areas of the U.S. Highlights from that report include:
- Portland, Oregon saw the largest annual increase in existing home sales in March with an increase of 45.6 percent in sales from a year ago.
- San Antonio, Texas was number two with a 29.7 percent increase in existing home sales from a year ago.
- Pittsburgh, Pennsylvania was number three with a 26.3 percent increase in existing home sales from a year ago.
- San Diego, California led the way in price increases from a year ago, with March’s median home price of $393,600 representing a 20.4 percent increase from a year ago when the median price was $326,800.
- St. Louis, Missouri came in second with a median price of $129,300, a 19.8 percent increase from a year ago when it was $107,900.
- Boston, Phoenix and Pittsburgh fell in behind St. Louis with annual median price increases of 13.9 percent, 13.3 percent and 13.1 percent respectively.
Lawrence Yun, NAR chief economist, said it is encouraging to see a broad home sales recovery in nearly every part of the country, with two important underlying trends. “Sales have been above year-ago levels for nine straight months, and inventory has trended down from year-ago levels for 20 months running,” he said. “The home buyer tax credit has been a resounding success as these underlying trends point to a broad stabilization in home prices. This is preserving perhaps $1 trillion in largely middle class housing wealth that may have been wiped out without the housing stimulus measure.”
I don’t like “seasonally adjusted rates of sales”:
If you have been reading my posts for a while you know by now I don’t like “seasonally adjusted” numbers (nor does Standard & Poors now either as I wrote about), particularly when artificial stimuli, such as homebuyer tax-credits, can cause an unseasonal spike in sales activity. I much prefer to see the actual numbers and try to garner from them what is going on in the housing market.
The following are the ACTUAL Existing Home sales reported by NAR without any adjustment or fluff:
- There were 427,000 existing homes sold in March which is a whopping 42.3 percent increase from February’s 300,000 sales and a 19.6 percent increase from March, 2009′s sales of 357,000 units.
- Below are highlights from each region:
- Northeast – 66,000 homes sold in March, an increase of 26.9 percent from February and an increase of 26.9 percent from the year before.
- Midwest - 97,000 homes sold in March, an increase of 44.8 percent from February and an increase of 19.8 percent from the year before
- South - 160,000 homes sold in March, an increase of 42.9 percent from February and an increase of 18.5 percent from the year before.
- West – 104,000 homes sold in March, an increase of 50.7 percent from February and a increase of 16.9 percent from the year before.
Other highlights of the NAR Report:
- Distressed sales accounted for 35 percent of all home sales in March, the same as February.
- First-Time homebuyers accounted for 44 percent of the home sales in March, up from 42 percent in February.
- Investors were the buyers of 19 percent of the homes in March, the same as February.
- Repeat home buyers were responsible for approximately 37 percent of March’s sales down from February’s 39 pecent..
My Take On the Numbers:
Last month I said that I was somewhat encouraged by the existing home sales for February and that I thought “the housing market, at least in many areas of the country, is toying with the bottom”. After seeing strong numbers in March I am again encouraged. I do think however we should all have “cautious optimism” as almost half of March’s home sales were first time home buyers who could be racing to beat the April 30th deadline to buy. My guess is we will see pretty good sales numbers in April as well, then the next couple of months beyond that will tell us if the market truly has any staying power or if it was just the “sugar-rush” of the tax-credits that boosted the market.
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