Forecast for Existing and New Home Sales (November 2018)

Existing home sales caught a much-needed reprieve in October, posting a month-over-month increase for the first time since March. It was not enough, however, to break a string of year-over-year declines in home sales – the longest extended period of annual declines since the 2013-14 Taper Tantrum.

We expect sales to revert to a more typical recent pattern in November, falling 1.4 percent from October to 5.15 million units at a seasonally adjusted annual rate (SAAR), down 10.1 percent from November 2017.

The National Association of Realtors (NAR) will report existing home sales on Wednesday, December 19.

While existing home sales have suffered from supply side constraints for the past three years, new home sales are facing more recent headwinds. They had been steadily increasing until late 2017, but have now been on a precipitous slide for the past year. October new home sales posted their slowest pace since early 2016 and have now undershot forecasts for five consecutive months.

We expect another disappointing month for new home sales in November with sales up 2.7 percent from October to 559,000 (SAAR), but down 21.5 percent from November 2017 – the recent high mark when 711,000 new homes were sold.

The U.S. Census Bureau will report new home sales on Thursday, December 27.