Existing home sales beat expectations with a climb to 5.71 million units, seasonally adjusted annualized (SAAR).
Econoday calls this an acceleration, is that what’s happening?
Highlights
The resale market, after a period of steady sales, is now accelerating to new expansion highs. Existing home sales rose a very sharp 4.4 percent to a higher-than-expected annualized rate of 5.710 million. This is the best rate since February 2007. Both components show strength with single-family sales up 4.3 percent to a 5.080 million rate and condo sales up 5.0 percent to a 630,000 rate. And year-on-year sales are moving higher, up 5.9 percent divided between 6.1 percent for single-family homes and 5.0 percent for condos.
The month’s gains aren’t tied to concessions as the median price rose 3.6 percent to $236,400 for a year-on-year rate of 6.8 percent that matches well with the sales trend. Supply, up 5.8 percent in the month to 1.830 million, moved into the market but was absorbed by rising sales which kept supply relative to sales unchanged at 3.8 months. The lack of supply and heated sales pace are reflected in days on the market which are down to 34 from 45 in the prior month and 47 days a year ago.
Housing contributed to last year’s economy but never kicked into top gear, which is what this report is hinting at. Watch on Tuesday’s calendar next week for new home sales which in the previous month shot higher much like today’s report.
Steady Upward Trends Since January 2014
Unfortunately, the data on Fred, the St. Louis Fed repository, only goes back to 2012.
Acceleration?
Acceleration is best thought of as an increase in the rate of change. Race car driving provides a nice example as does gravity (the speed at which an object falls over time). Other than random fluctuations, there is no acceleration, just a steady linear trend.
Sales in February 2007 were at a rate of 5.79 million units according to Mortgage News Daily.
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