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Existing-home sales declined 0.7 percent in May. It was the 22nd decline in 28 months. But the median price hit a new record.
 

Existing-home sales courtesy of the National Association of Realtors (NAR)

The NAR reports Existing-Home Sales Edged Lower by 0.7% in May as Median Sales Price Reached Record High of $419,300
 

Key Highlights

• Existing-home sales slipped 0.7% in May to a seasonally adjusted annual rate of 4.11 million. Sales descended 2.8% from one year ago.
• The median existing-home sales price jumped 5.8% from May 2023 to $419,300 – the highest price ever recorded and the eleventh consecutive month of year-over-year price gains.
• Total housing inventory registered at the end of May was 1.28 million units, up 6.7% from April and 18.5% from one year ago (1.08 million). Unsold inventory sits at a 3.7-month supply at the current sales pace, up from 3.5 months in April and 3.1 months in May 2023.
• First-time buyers were responsible for 31% of sales in May, down from 33% in April but up from 28% in May 2023.
• All-cash sales accounted for 28% of transactions in May, unchanged from April and up from 25% one year ago. Individual investors or second-home buyers, who make up many cash sales, purchased 16% of homes in May, identical to April and up from 15% in May 2023.

NAR Comments

“Home prices reaching new highs are creating a wider divide between those owning properties and those who wish to be first-time buyers,” said NAR Chief Economist Lawrence Yun.

“The mortgage payment for a typical home today is more than double that of homes purchased before 2020. Still, first-time buyers in the market understand the long-term benefits of owning.“

Actually, what consumers understand is inflation is killing them. However, misguided economists don’t consider this inflation.

Existing-Home Sales Percent Change from Month Ago

Existing-home sales are down 23 out of the last 28 months.

Existing-Home Sales Supply

“Eventually, more inventory will help boost home sales and tame home price gains in the upcoming months,” said NAR Chief Economist Lawrence Yun.

Taming increases won’t do much for this market.

New buyers some combination of a price crash and mortgage rate crash coupled with a non-recessionary environment and big wage gains. Good luck with that.

Existing-Home Sales Percent Change from Year Ago

Data on the St. Louis Fed is limited. Year-over-year sales are down for at least 23 consecutive months.

At some point, year-over-year sales will rise but don’t make too much of it. The following chart puts sales into the proper perspective.

Existing-Home Sales Since 1968

Image courtesy of Trading Economics and the NAR

We are in the midst of the third transaction crash since 1968. This crash has not been accompanied by a price crash.

Sales are about where they were in November of 1978. Population-adjusted sales are abysmal.

The Civilian Noninstitutional Population (age 15+ not in the military or prison, etc.) was 132.9 million in November of 1978. As of May 2024, the population was 268.2 million.

Housing Starts and Permits Drop to the Lowest Level in Four Years

Housing Starts, Permits, and Completions data from the Commerce Department, chart by Mish

Yesterday, I reported Housing Starts and Permits Drop to the Lowest Level in Four Years

Hoot of the day: The Bloomberg Econoday consensus had housing starts and permits both rising. Several charts show how much they dropped.

Where Do We Put 8 Million Illegal Immigrants?

On May 23, I asked Where Do We Put 8 Million Illegal Immigrants?

Millions of immigrants keep pouring in. New residential construction has stalled and multi-family construction is in decline. Completions are rising, but is that enough housing?

One of Every Five New York City Hotels is Now a Migrant Shelter

On June 2, I noted One of Every Five New York City Hotels is Now a Migrant Shelter

New York City hotel prices have never been higher. Illegal immigration is part of the reason why. Mayoral graft is another.

Don’t worry, LA has the affordable housing solution starting with “affordable housing units at $600,000 each to house 278 homeless out of 75,518 in the county.

Please note A New High-Rise Building Will House the LA Homeless in $600,000 Units

If the county were to shelter the 75,518 homeless, the cost would be $45,310,800,000. That’s $45.3 billion, excluding free property taxes, case workers, maintenance, utilities, insurance, food, police, clothes, doormen, or medical care.

And it would not stop there. Every homeless person in the state would move their tent to LA to participate.

This dear woke fans is what’s known as “affordable housing”.

Clearly, the proper solution is to do the same thing for 8 million illegal migrants. After all, free food, free clothes, and free shelter is a right.

More seriously, the economy is slowing on many fronts.

For example, Retail Sales Were Very Weak in May Counting Negative Revisions

Also, please consider my follow-up post Breadsticks at Olive Garden Highlight Financial Strain on America’s Middle Class

A friend emailed a link regarding Olive Garden traffic and sales. I created a new chart that agrees. Call it the breadstick indicator.

Job Openings vs Unemployment Looks Very Much Like a Recession Has Begun

Job openings and unemployment level from the BLS, chart by Mish

Weakness is pervasive.

For discussion, please see Job Openings vs Unemployment Looks Very Much Like a Recession Has Begun

Unemployment is rising and job openings have crashed. It looks recessionary.

More By This Author:

Breadsticks At Olive Garden Highlight Financial Strain On America’s Middle Class
Housing Starts And Permits Drop To The Lowest Level In Four Years
A New High-Rise Building Will House The LA Homeless In $600,000 Units