Existing Home Sales Rise 0.8% in October But Fall 5.8% From Year Ago

Home Sales Inch Up

The National Association of Realtors reports Existing-Home Sales Inch Up 0.8% in October

Key Points 

• Total existing-home sales, completed transactions that include single-family homes, townhomes, condominiums and co-ops, rose 0.8% from September to a seasonally adjusted annual rate of 6.34 million in October. 
• Sales fell 5.8% from a year ago (6.73 million in October 2020).
• Total housing inventory at the end of October amounted to 1.25 million units, down 0.8% from September and down 12.0% from one year ago (1.42 million).
• Unsold inventory sits at a 2.4-month supply at the current sales pace, equal to September's supply, and down from 2.5 months in October 2020.
• The median existing-home price for all housing types in October was $353,900, up 13.1% from October 2020 ($313,000), as prices climbed in each region. 
• This marks 116 straight months of year-over-year increases, the longest-running streak on record.

Regional Breakdown

• Northeast: Existing-home sales in the Northeast fell 2.6% in October, registering an annual rate of 750,000, a 13.8% decline from October 2020. The median price in the Northeast was $379,100, up 6.4% from one year ago.
• Midwest: Existing-home sales in the Midwest rose 4.2% to an annual rate of 1,500,000 in October, a 6.3% decrease from a year ago. The median price in the Midwest was $259,800, a 7.8% jump from October 2020.
• South: Existing-home sales in the South increased 0.4% in October, posting an annual rate of 2,780,000, a 3.5% drop from one year ago. The median price in the South was $315,500, a 16.1% climb from one year prior.
• West: Existing-home sales in the West neither rose nor fell from the prior month's level, registering an annual rate of 1,310,000 in October, down 5.1% from one year ago. The median price in the West was $507,200, up 7.7% from October 2020.

Existing Home Sales Since 1970

First Time Buyers, Investors, and All Cash Sales 

• In October, first-time buyers were responsible for 29% of sales, up from 28% in September and down from 32% in October 2020. 
• Individual investors or second-home buyers, who make up many cash sales, purchased 17% of homes in October, up from both 13% in September and from 14% in October 2020. 
• All-cash sales accounted for 24% of transactions in October, up from both 23% in September and from 19% in October 2020.

Why Buying a Second or Even Third Home Is Becoming More Popular Than Ever

Bloomberg reports Why Buying a Second or Even Third Home Is Becoming More Popular Than Ever

One thing is pretty clear: Speculation and yield seeking are rampant as evidenced by second home buying.