February existing home sales confirm prices have eased, but bottoming out in sales and construction may have occurred

– by a New Deal Democrat

There were only two notable takeaways from February’s existing home sales report:

(1) like mortgage applications, permits and starts, existing home sales responded to lower mortgage rates (down from just over 7% to just over 6% between last October and January):

(2) As usual, price changes slow down sales; for the first time since the pandemic, the median home price actually fell -0.2% year over year from $363,700 to $363,000 (remember: this data is not seasonally adjusted):

It just confirms the data we got from the more important data on new home construction. I think there is some good news here as we may have seen a bottom in this metric as well as permits, starts and mortgage applications. That doesn’t mean a recession won’t happen; but suggests it won’t be long and may not be very deep.

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