U.S. sales of existing homes in October rose 4.3% from September and 26.6% annually to a seasonally adjusted annualized rate of 6.85 million units, above expected 6.47 million, according to NAR’s press release. The annualized sales rate is the highest since February 2006 with the highest pace ever recorded in 2005 at 7.1 million units.
- Prior existing home sales revised higher from 6.54 million to 6.57 million
- With ongoing vaccine developments and mortgage rates projected to hover around 3% in 2021, NAR expects existing-home sales to rise by 10% to 6 million in 2021.
- The possible rise of mortgage rates and increasing coronavirus cases could dampen home sales in the months ahead.
- Volatile materials costs and shortage of available land could slow down homebuilders in future project pipelines.
- October’s record home sales represent contracts signed in August and September and will offset spring market losses.
- There were 1.42 million existing homes on the market at the end of October, representing the lowest record of 2.5-month supply, about a 19.8% fall from October 2019
- The low supply of homes for sale in October drove median prices to $313,000 in October, up 15.5% annually, the highest rise on record.
- Sales of homes priced $1 million and above nearly doubled, but sales fell in the lowest price range.
- First-time buyers were 32%, from from 31% month over month
- Distressed sales remained below 1%, the same as previous
- Regionally, month to month sales rose the highest in the Midwest by 8.6%, followed by Northeast by 4.7%, in the south by 3.2%, and in the West by 1.4%
- Mortgage applications to purchase newly built homes rose nearly 33% annually
- Single-family building permits we flat for the month.
SPDR S&P Homebuilders ETF is currently gaining. XHB is up 0.36%
