May Existing Home Sales at 4.81mm annualized were about in line with expectations and down from a revised 5mm in April (5.05mm initial report). It’s the lowest sales volume since Nov with both single family and condo/co-op sales falling. Even though the absolute number of homes for sale fell by 39k, the sluggish sales pace had months supply rising to 9.3 from 9.0, the most since Nov. Regionally, the area with the most foreclosures, the West, saw sales unchanged but the Northeast, Midwest and South all saw declines. Distressed sales totaled 31% of sales, down from 37% in April. The median home price fell 4.6% y/o/y from the tax credit induced jump last year, thus those that bought then are now underwater today. Oh the unintended consequences of not letting a market clear. The NAR is still citing continued tightness in lending standards in holding back a recovery, in addition of course to a still very sluggish economic environment. With mortgage rates averaging a very low 4.59% in May, it’s clearly not the cost of money that is the factor, it is the access to it.
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