Rapid Reaction: December Existing Home Sales

By Svenja Gudell on 22 Jan 2016

• Sales of existing homes rose up 14.7 month-month in December, more than reversing the 10.5 percent drop first reported for November, according to the National Association of Realtors.
• Implementation of new settlement and disclosure rules (known as TRID), likely played a role in shifting home purchases that may have otherwise closed in November into December.
• The median price of existing homes sold in December was up 7.6 percent month-month, to $224,100. The median seasonally adjusted price increased to $229,000, from $224,100 – surpassing its pre-crisis (November 2005) peak of $227,200 for the first time.

December existing home sales were up big, but it’s important to keep things in context. After a positive start to the year, existing sales in the second half of 2015 were roughly flat. And December’s big gain follows a large drop in November. Averaging sales figures from the final two months of the year results in roughly 5.1 million sales (at a seasonally adjusted annual rate) per month, the lowest two month average since March. Additionally, implementation of new settlement and disclosure rules (known as TRID) likely played a role in shifting home purchases that may have otherwise closed in November into December. Finally, overall inventory of homes for sale remains low, especially for entry-level homes, which is helping to keep existing home sales in check.