Existing Home Sales Fell Less Than Expected in July

Existing home sales fell -.2% MoM (consensus -.9%) in July, and June's declined was revised slightly smaller to only -3.7% from -3.8% MoM. This marks the fifth consecutive month that existing home sales have declined. The pace has dropped by 9% versus a year ago, and has now fallen to a sales pace last seen in 2002.

Single family home sales fell -.4% MoM (-9.3% YoY), while condos rose +1.4% MoM (-7.5% YoY).

Total supply rose to 9.6 months, at the current sales pace, the highest level since 1991. Single family is at 9.2 months, while condos rose to 11.9 months, almost a 20% increase from the 10 month supply available in June. The actual number of resale homes for sale rose 5.1% to 4.59 million.

Median home prices fell -.6% YoY, with single family median prices falling -1% YoY and condos rising +2.4% YoY. The median resale price for a home in the U.S. is now $228,900.

The Midwest was the only region to see a decline in home sales (-2.2% MoM). Sales in the South were static. Sales rose +1% MoM in the Northeast and +1.8% MoM in the West during July. Median home sales prices have risen +5.9% YoY in the Northeast, are up +.9% YoY in the West, and have fallen -1.8% YoY in the Midwest and -3.2% YoY in the South as of July.

Existing home sales represent contract closings of agreements typically made one to two months earlier, so these figures are less likely to have been impacted by recent credit tightening events, as long as the mortgage lender remained in business to fund the loan. Existing home sales account for about 85% of homes sold each year, with new home sales meeting the balance of the demand for housing.

July tends to be a peak home selling month as people move between school years. Most economists are expecting sales to continue contracting as the credit markets tighten.