Economy Watch: Total Existing-Home Sales, California REO Sales Drop; Chicago Fed Economic Activity Index Improves
- Jul 23, 2013
The National Association of Realtors reported on Monday that total existing-home sales dropped 1.2 percent in June to an annualized rate of 5.08 million units—including single-family, condos, co-ops, and townhouses—from a downwardly revised 5.14 million units in May. Still, the June 2013 rate is 15.2 percent higher than in June 2012.
Total U.S. housing inventory at the end of June rose 1.9 percent to 2.19 million existing homes available for sale, which represents a 5.2-month supply at the current sales pace, up from five months in May. Listed inventory remains 7.6 percent below a year ago, when there was a 6.4-month supply.
Despite the general increase in housing sales, however, much of the positive trend is skewed toward to upper-tier households. “The housing recovery has been tilted toward upper-income households and those with cash,” Resource Real Estate CEO Alan Feldman told Commercial Property Executive. “The recovery hasn’t progressed evenly. That’s to the benefit of multi-family landlords, because middle-income renters are still having a difficult time becoming owners.”
California REO Sales Drop
San Diego-based DataQuick, in a report released on Monday, said that an estimated 41,027 new and resale residential properties sold statewide in California last month. That was down 6.9 percent from May, and down 3.5 percent from June 2012. Last month’s sales were 16.8 percent below the average of 49,301 sales for all the months of June since 1988, when DataQuick’s statistics begin. California is worth paying attention to as a bellwether residential market among the states, where trends in housing often appear before other parts of the country.
In a more promising California housing trend, only 10 percent properties sold in June had been foreclosed on during the past year – the lowest level since foreclosure resales were 9.4 percent of the resale market in August 2007. The June 2013 figure was down from 11.3 percent in May and 24.9 percent a year earlier. Foreclosure resales peaked at a whopping 58.8 percent of the market in February 2009.
As for short sales, they made up an estimated 16 percent of the homes that resold in June, down from 16.8 percent the previous month and 24.3 percent a year earlier. All together, DataQuick’s report says, indicators of market distress continue to decline.
Chicago Fed Economic Activity Index Improves
The Chicago Federal Reserve said on Monday that its National Activity Index (CFNAI), led by improvements in production-related indicators, increased to –0.13 in June from –0.29 in May. The index’s three-month moving average, which is known as CFNAI-MA3, increased to –0.26 in June from –0.37 in May, marking an improvement, but still its fourth consecutive reading below zero. June’s CFNAI-MA3 suggests that growth in national economic activity was below its historical trend, but it’s better than it has been in recent months.
Wall Street ended the day up on Monday, with the Dow Jones Industrial Average gaining 1.81 points, or a microscopic 0.01 percent. The S&P 500 was up 0.2 percent and the Nasdaq advanced 0.34 percent.