April 2014 Existing Home Sales Increased 1.3 Sequentially From March

Existing home sales, for the first time in 2014, increased sequentially from the prior month, rising to 4.65 million sales on a seasonally adjusted annualized rate (SAAR) according to the National Association of Realtors® (NAR). On a year-over-year basis, however, home sales were down 6.8 percent from the 4.99 million SAAR posted in April 2013.

Median price in April was $201,700, up 5.2 percent from a year ago.

On a 12-month moving average basis, sales were up 3.3 percent while median price rose 10.4 percent.

The raw “Base” data from NAR are included in the following graph. The sales rate and median price show an upward trajectory in the latest month.

5-23-14 graph1

The next graph shows both the raw or base data along with the 12-month moving averages.

5-23-14 graph2

Other statistics and metrics in the NAR release included:

  • 15 percent of all sales were distressed, with foreclosures accounting for 10 percent and short sales 5 percent
  • Foreclosure sales sold at an average 16 percent discount when compared to non-distressed properties while short sales were discounted 10 percent
  • Investors bought 18 percent of all sales in April 2014, similar to the 19 percent level in April 2013. Investors paid cash in 70 percent of their acquisitions
  • All-cash transaction made up 32 percent of sales, identical to April 2013, despite a small decline in investor purchases
  • Median time on the market was 48 days in April, with non-distressed properties selling in 45 days, foreclosures 56 days and short sales 96 days. Four-out-of 10 sales (41 percent) sold in less than one month.
  • The number of months of inventory, at 5.9 months, would indicate a normal market in relationship to supply and demand (with 6 months inventory considered normal)

Again, I reiterate expectations for existing home sales to rise as the weather warms. Fannie Mae’s latest forecast calls for 4.981 million sales, a 7.1 percent increase from the current level as 2014 progresses. The slow start to the 2014 sales season, I believe, is a function of fewer signed contracts due to severe weather from December through March.

Ted

 

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