January Existing Home Sales
Updated 09-Mar-10 19:32 ET
Highlights
- Existing home sales declined from 5.440 mln homes to 5.050 mln homes in January.
- The consensus expected a small increase to 5.550 mln homes.
- The median price declined from $170,500 in December to $164,700 in January. Prices are now at the same level they were in January 2009.
Key Factors
- The decline in January was the second consecutive monthly drop, which follows four months of increases starting in August and culminating with November’s 6.540 mln homes sold.
- The growth in homes sold from August through November and its subsequent free fall in December and January are directly due to the first-time homebuyers’ tax credit. Realtors pressured buyers to make purchases before the tax credit’s original expiration date at the end of November. This left a much smaller pool of available buyers in December and January. We expect that it will take a few months before the supply of potential homebuyers swells enough to support stronger sales.
Big Picture
- The government stimulus program that aided first-time home buyers was originally set to expire in November. As a result, many potential buyers rushed into the market in October and November to obtain the rebate. The existing home sales data will see a pullback in sale starting in December as the potential buyer pool has shrunk.
| Category |
JAN |
DEC |
NOV |
OCT |
SEP |
| Existing Home Sales |
5.05M |
5.45M |
6.49M |
6.09M |
5.54M |
| Months Supply |
7.8 |
7.2 |
6.5 |
7.0 |
8.0 |
| Median Price Y/Y |
0.0% |
-3.0% |
-5.7% |
-7.7% |
-8.0% |
