May 2018 Existing Home Sales: Stuck
- Existing home sales were weaker than expected for a second consecutive month in May, falling 0.4 percent from April to 5.43 million units at a seasonally adjusted annual rate (SAAR).
- For-sale inventory was flat in May, although if April inventory had not been revised downward, it would have fallen.
- The median seasonally adjusted price of existing homes sold fell 0.3 percent from April to $255,300 in May, the second month of declining median sales price.
Existing home sales fell 0.4 percent from April to 5.43 million units at a seasonally adjusted annual rate (SAAR) according to the National Association of Realtors (NAR). It was the second consecutive month that sales have come in weaker than anticipated, and sales are now down 3 percent from a year earlier.
For the past year and a half, existing home sales have struggled to breach 5.7 million units. But increasingly what had been characterized as a flat plateau is starting to resemble a gentle downward slope: Month-over-month and year-over-year declines in sales have accelerated over the past three months.
Sales of both single-family homes and condos/coops continue to trend upward in the South, but have now begun to trend downward in the West.[1] Single-family sales have been trending downward in the Northeast and Midwest since the start of 2018.
The number of existing homes on the market was essentially flat in May at 1.72 million units (SAAR). With the downward revision to April inventory, inventory would have declined slightly. Inventory is down 6.2 percent over the past year, but over the past six months appears to have stabilized at low levels. While it is not increasing, it is no longer steadily falling as it had been for the previous three years.
The median seasonally adjusted price of existing homes sold in May fell 0.3 percent to $255,300, but remains 4.9 percent higher than it was in May 2017. It was the first time since summer 2015 that the median seasonally adjusted sale price has declined for two consecutive months.
[1] Year-over-year change in the 12-month moving average of existing single-family home sales.