Economy: Existing Home Sales During November 2017

The Existing Home Sales report for November 2017 was released by The National Association of Realtors® (NAR) this morning:

Predicted: 5,550,000
Actual: 5,810,000

Change from Previous Month: +5.6%
Change from One Year Previous: +3.8%

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Inventory: 1,670,000 (3.4 months supply)

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The yellow-highlighted, "actual" figure above represents the preliminary, seasonally adjusted annualized sales count of existing homes, co-ops and condominiums for the indicated month. The "predicted" figure is what economists were expecting, while the "actual" is the true or real figure.

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Median Price for A Used Home During November 2017: $248,000

Change from One Year Previous: +5.8%

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Average Price for A Used Home During November 2017: $289,900

Change from One Year Previous: +4.8%

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Click here for historical prices and a chart.

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From today's report:

"...Existing-home sales surged for the third straight month in November and reached their strongest pace in almost 11 years, according to the National Association of Realtors®. All major regions except for the West saw a significant hike in sales activity last month.

"The anticipated rise in mortgage rates next year could further cut into affordability if these staggeringly low supply levels persist,' said Yun. 'Price appreciation is too fast in a lot of markets right now. The increase in homebuilder optimism must translate to significantly more new construction in 2018 to help ease these acute inventory shortages.'

First-time buyers were 29 percent of sales in November, which is down from 32 percent both in October and a year ago. NAR’s 2017 Profile of Home Buyers and Sellers – released earlier this year – revealed that the annual share of first-time buyers was 34 percent.

Matching the highest share since May, all-cash sales were 22 percent of transactions in November, which is up from 20 percent in October and 21 percent a year ago. Individual investors, who account for many cash sales, purchased 14 percent of homes in November, up from 13 percent last month and unchanged from a year ago.

'The elevated presence of investors paying in cash continues to add a layer of frustration to the supply and affordability headwinds aspiring first-time buyers are experiencing,' said Yun. 'The healthy labor market and higher wage gains are expected to further strengthen buyer demand from young adults next year. Their prospects for becoming homeowners will only improve if more lower-priced and smaller-sized homes come onto the market.'

Properties typically stayed on the market for 40 days in November, which is up from 34 days in October but down from 43 days a year ago. Forty-four percent of homes sold in November were on the market for less than a month.

"On the topic of tax reform, NAR President Elizabeth Mendenhall, a sixth-generation Realtor® from Columbia, Missouri and CEO of RE/MAX Boone Realty, says it’s good news homeowners can continue to count on tax incentives such as the mortgage interest deduction and the state and local tax deduction.

'Only 6 percent of homeowners have mortgages exceeding $750,000, and only 5 percent pay more than $10,000 in property taxes, but most homeowners won’t itemize under the new regime,' she said. 'While we’re pleased that important homeownership incentives such as the capital gains exclusion survived in conference, additional changes are required to truly incentivize homeownership in the tax code.'

Distressed sales – foreclosures and short sales – were 4 percent of sales for the fourth straight month in November, and are down from 6 percent a year ago. Three percent of November sales were foreclosures and 1 percent were short sales..."