One Hell Of A Seasonal Adjustment: NAR's Existing Home Sales Math

The NAR says existing home sales are down 2.2% from a year ago. The breakouts by price range do not seem to add up.

The NAR reports Existing-Home Sales Falter 1.7% in June

Total existing-home sales completed transactions that include single-family homes, townhomes, condominiums and co-ops, dropped 1.7% from May to a seasonally adjusted annual rate of 5.27 million in June. Sales as a whole are down 2.2% from a year ago (5.39 million in June 2018).

Percent Sales by Price Range

 

Percent Changes From Year Ago by Price Range

 

The NAR's Supplemental Data provides a look at regional differences.

Supplemental Data

 

Weighted Contributions

 

Down 10% on a 35.7% distribution overwhelms up 1.0% on a 39.4% contribution.

I calculate net weighted sales as -4.72% year-over-year based on the NAR's Sales Distribution Percentages.

Seasonal Adjustments

I bounced this off Calculated Risk who tells me there was a huge seasonal adjustment this year. To my way of thinking, seasonal adjustments should not affect year-over-year comparisons.

But it did, as presented.

It's one hell of a seasonal adjustment.

Explaining the Sales Decline

Please also see Existing Homes Prices Up 88th Month: NAR Can't Figure Out Why Sales Are Down

Disclaimer: The content on Mish's Global Economic Trend Analysis site is provided as general information only and should not be taken as investment advice. All site content, including ...

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