The headlines for existing home sales claim “strong growth”. Our analysis of the unadjusted data shows this was an understatement. The unadjusted three month rolling averages for sales accelerated, continues in positive territory – and has been in a long term improvement trend even though being in contraction most of 2014.
Econintersect Analysis:
- Unadjusted sales growth accelerated 8.9% month-over-month, up 13.5% year-over-year – sales growth rate trend is accelerating using the 3 month moving average.
- Unadjusted price growth accelerated 0.4% month-over-month, up 5.1% year-over-year – price growth rate trend is modestly improving using the 3 month moving average.
- The homes for sale inventory grew this month, remains historically low for Marchs, and is up 2.0% from inventory levels one year ago).
NAR reported:
- Sales up 6.1% month-over-month, up 10.4% year-over-year.
- Prices up 7.8% year-over-year
- The market expected annualized sales volumes of 4.850 to 5.045 million (consensus 5.045) vs the 5.190 million reported.
Unadjusted Year-over-Year Change in Existing Home Sales Volumes (blue line) – 3 Month Rolling Average (red line)
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The graph below presents unadjusted home sales volumes.
Unadjusted Monthly Home Sales Volumes
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Here are the headline words from the NAR analysts:
Lawrence Yun, NAR chief economist, says the housing market appears to be off to an encouraging start this spring. “After a quiet start to the year, sales activity picked up greatly throughout the country in March. The combination of low interest rates and the ongoing stability in the job market is improving buyer confidence and finally releasing some of the sizable pent-up demand that accumulated in recent years. The modest rise in housing supply at the end of the month despite the strong growth in sales is a welcoming sign. For sales to build upon their current pace, homeowners will increasingly need to be confident in their ability to sell their home while having enough time and choices to upgrade or downsize. More listings and new home construction are still needed to tame price growth and provide more opportunity for first-time buyers to enter the market.
NAR President Chris Polychron says there needs to be additional choices for borrowers looking for safe and secure mortgage products to finance their home purchase. Realtors® urge the U.S. Senate to schedule a vote for the bipartisan Mortgage Choice Act, which passed the U.S. House of Representatives last week. This legislation levels the playing field for brokerages with affiliated business agreements by eliminating the 3 percent cap on the calculations of fees and points in the Dodd-Frank Ability-to-Repay/Qualified Mortgage rule.
