By Robert Hughes
Sales of existing homes rose 4.3 percent in October to a 6.85 million seasonally-adjusted annual rate. Sales are now up 26.6 percent from a year ago and are at the highest level since November 2005 (see top of first chart).
Sales were up in all four regions in October: sales were up 1.4 percent in the West and are up 22.8 percent from the year-ago level; sales rose 3.2 percent in the South, the largest region by volume, leaving that region’s sales rate 26.5 percent above the year-ago pace; sales gained 8.6 percent for the month in the Midwest and are 28.1 percent above the October 2019 rate; and sales were up 4.7 in the Northeast, and were 30.4 percent below year-ago levels.
Sales in the market for existing single-family homes, which account for around 90 percent of total existing-home sales, rose 4.1 percent in October, coming in at a 6.12 million seasonally-adjusted annual rate. From a year ago, sales are up 26.7 percent. The October pace is the fastest since November 2005 (see top of first chart).
By region, sales for existing single-family homes all posted gains for October: sales were up 1.6 percent in the West and are up 22.8 percent from the year-ago level; sales rose 2.8 percent in the South, leaving that region’s sales rate 26.1 percent above the year-ago pace; sales gained 8.4 percent for the month in the Midwest and are 28.1 percent above the October 2019 rate; and sales were up 4.1 percent in the Northeast, leaving sales 32.8 percent above year-ago levels.
Condo and co-op sales posted a 5.8 percent rise for the month, leaving sales 25.9 percent above the October 2019 pace. Sales came in at a 730,000 pace for the month versus 690,000 in September.
Total inventory of existing homes for sale fell 2.7 percent to 1.42 million in October, pushing the month’s supply (inventory times 12 divided by the annual selling rate) to 2.5, a new low, from 2.7 in September (see bottom of first chart). For the single-family segment, the month’s supply also fell, to 2.4, also a new record low (see bottom of first chart), from 3.8 in September, while the condo and co-op months’ supply fell to 3.6 from 3.9.
The median sale price in October of an existing home was $313,000, 15.5 percent above the year-ago price. For single-family existing home sales in October, the price was $317,700 (see top of second chart), a 16.0 percent rise over the past year (see bottom of second chart), while the median price for a condo/co-op was $273,600, 10.3 percent above October 2019. Though unemployment remains high and the outlook for the labor market and the broader economy remains highly uncertain, near-record-low mortgage rates and surging demand for housing are supporting a strong recovery for the housing market. Only time will tell if these conditions will continue, but for now, the housing market remains one of the brightest areas of the economy.
Editor’s Note: The summary bullets for this article were chosen by Seeking Alpha editors.