Existing Home Sales: Declines In April

Bottom Line: Existing home sales fell a touch more than expected in April as mortgage rates rose and home prices continued to edge higher. While historically still low, inventories rose again and stood at 2.2 months of sales. Average and median home prices were sharply higher as higher-end buyers could still afford homes averaging nearly $400k even with higher mortgage rates. Overall, sales were still surprisingly strong given the move in mortgage rates. That said, we should keep in mind that existing home sales are based on closings, and thus, these April data are lagged. Since this tally, mortgage purchase applications have fallen sharply, suggesting that May and June sales will likely prove sharply lower.

Existing Home Sales FELL by 2.4% in April to 5.61 million, compared with market expectations for a decline to 5.64 million. The prior month was revised down from 5.77 to 5.75 million.
 
Home re-sales are now 5.9% BELOW their year-ago level.
 
The Inventory of Homes Available for Sale ROSE by 10.8% to 1,030k but are still 10.4% BELOW  their year-ago level. Because inventories increased while sales declined, the Months Supply ROSE to 2.2 months from 1.9 months.  This is BELOW the 6 month level that is considered 'normal'.Home Prices ROSE compared to their year-ago levels. Average home prices are 9.2% ABOVE their year-ago levels while median home prices are 14.8% ABOVE their year-ago levels.