MNI DATA ANALYSIS: US Dec Existing Home Sales -3.6% to 5.57M

By Kevin Kastner, Sara Haire and Holly Stokes

     WASHINGTON (MNI) - Home resales fell by 3.6% in December to an annual rate

of 5.57 million, below expectations for a slight increase to a 5.70 million pace

and following a slightly downward revision to 5.78 million in November, data

released by the National Association of Realtors reported Wednesday showed.

     Still, the annualized November and December sales rates were above the full

year level of 5.51 million for 2017, suggesting a solid end to the year. The

2017 year total was the highest since 2006, up from 5.45 million in 2016.  

     However, sales are forecast to tick up only slightly to 5.52 million in

2018 as affordability issues remain. Single-family and multi-family sales were

both modestly higher in 2017.

--SUPPLY RECORD LOW

     The number of housing units available for sale fell by 11.4% in December to

a total of 1.48 million houses, the lowest on record. Even with the dip in the

sales pace in December, the months supply fell to a record low 3.2 months at the

current sales pace from 3.5 months in November and 3.6 months a year ago. 

--PRICES STILL SURGING

     December's national median price of $246,800 was up 5.8% from a year

earlier, a much faster pace than wage growth. The median sales price was

$247,300 in 2017, up sharply from $233,800 in 2016. With supply declining and

sales rising, it appears this trend will continue. 

--ALL REGIONS DOWN

     Sales fell in all four regions of the country in December. For 2017, sales

were unchanged in the Northeast and Midwest, so gains in South and Midwest

regions drove the overall 2017 increase.

     NAR VP of research Paul Bishop told reporters that the improvement in 2017

reflects strong job growth and low mortgage rates, but NAR remains concerned

about the effects of low home inventories and surging prices.

--MNI Washington Bureau; tel: +1 202-371-2121; email: kevin.kastner@marketnews.com

[TOPICS: MAUDS$,M$U$$$]