Existing home sales in April, measuring actual closings in the important spring season, totaled 4.28mm, about as expected but down from 4.43mm in March. April months’ supply rose to 2.9 from 2.6 but they typically rise this time of the year. The median home price fell 1.7% y/o/y and that’s the 2nd month in a row of declines. It was bifurcated though as prices rose in the Northeast and Midwest where supplies are tighter but fell in the South and West. The West in particular saw the medium price fall by 8% y/o/y. Keep in mind that price mix is an influence on median pricing.
The first time buyer totaled 29% of purchases vs 28% in March and near the lower end of historical trends, not surprisingly considering the affordability challenges for this cohort. All cash buyers made up 28% of buying vs 27% in March and 28% in February. Days on the market was 22 vs 17 in April 2022 but down from 29 in March and 34 in February, likely because of the still challenge of tight inventory.
The NAR said “The combination of job gains, limited inventory and fluctuating mortgage rates over the last several months have created an environment of push-pull housing demand.”
Bottom line, sales of existing homes are near 12 yr lows both because of the lack of inventory but in turn that is helping to maintain the 40% rise in home prices over the past few years and in the face of a doubling of mortgage rates and that then creates the affordability problem for first time buyers. We are in a very distorted housing market that either way, it’s very expensive in particular for a first time buyer. At least the owner of a home is playing with ‘house’ money when selling an existing home and wanting to buy another. For the health of the housing market, I’d argue we need both more supply and lower prices.
As this number is somewhat dated, it’s never market moving and Treasury yields are about where they were just before the release. They seem to be trading more on what was said by Lorie Logan and debt ceiling noise than anything else.
Existing Home Sales
Median Home Price y/o/y