Home Logon FTA Investment Managers Blog Subscribe About Us Contact Us

Search by Ticker, Keyword or CUSIP       
 
 

Blog Home
   Brian Wesbury
Chief Economist
 
Bio
X •  LinkedIn
   Bob Stein
Deputy Chief Economist
Bio
X •  LinkedIn
 
  Existing Home Sales Rose 0.8% in February to an Annual Rate of 4.98 Million Units
Posted Under: Data Watch • Home Sales • Housing
Supporting Image for Blog Post

 
Implications: Existing home sales rose slightly in February coming in at the highest sales pace since November 2009, when sales were artificially boosted by an $8,000 homebuyer tax credit. Sales are up 10.2% from a year ago. Although the inventory of existing homes rose for the first time in six months, they are still down 19.2% from a year ago. Because of the increase in inventories, the months' supply of homes (how long it would take to sell the entire inventory at the current selling rate) rose to 4.7. Some of the increase in inventories is probably due to higher prices getting fence-sitting potential sellers into the market. Regardless, this is not a sign of trouble. Just a year ago, the months' supply was 6.4. The 11.6% gain in median prices versus a year ago can be attributed to a couple of factors. First, lower inventories while demand is picking up. Second, fewer distressed sales and more sales of larger homes. This can be seen in the sales data as homes priced from $0-$100,000 were down 12.8% from a year ago while those $1,000,000+ are up 27.4%. In general, it still remains tougher than normal to buy a home. Despite record low mortgage rates, home buyers face very tight credit conditions. Tight credit conditions would also explain why all-cash transactions accounted for 32% of purchases in February versus a traditional share of about 10%. Those with cash are able to take advantage of home prices that are extremely low relative to fundamentals (such as rents and replacement costs); for them, it's a great time to buy. In other housing news today, the FHFA index, which measures prices for homes financed by conforming mortgages, increased 0.6% in January (seasonally-adjusted), and is up 6.5% from a year ago. In other news this morning, initial claims for unemployment insurance rose 2,000 last week to 336,000. The four-week moving average of claims is now 340,000. Continuing claims for regular state benefits increased 5,000 to 3.05 million. These figures are consistent with more solid job growth in March. On the manufacturing front, the Philly Fed index, a measure of activity in that region, rose to +2.0 in March from -12.5 in February. Regional manufacturing surveys have been coming in better so far in March and we anticipate an increase in the national ISM index for the month.

Click here for a PDF version
Posted on Thursday, March 21, 2013 @ 11:49 AM • Post Link Print this post Printer Friendly

These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.
Search Posts
 PREVIOUS POSTS
Fed Still Inching Toward Optimism
Housing Starts Rose 0.8% in February to 917,000 Units at an Annual Rate
First Trust’s Wesbury and Stein #1 out of 100 for Home Price Forecasting
Say "Thanks" to Barney Frank
The Consumer Price Index (CPI) increased 0.7% in February
Industrial production rose 0.7% in February
The Producer Price Index (PPI) Rose 0.7% in February
What's Wrong with the Republicans
Retail Sales Increased 1.1% in February
The Plow Horse is Trotting
Archive
Skip Navigation Links.
Expand 20242024
Expand 20232023
Expand 20222022
Expand 20212021
Expand 20202020
Expand 20192019
Expand 20182018
Expand 20172017
Expand 20162016
Expand 20152015
Expand 20142014
Expand 20132013
Expand 20122012
Expand 20112011
Expand 20102010

Search by Topic
Skip Navigation Links.

 
The information presented is not intended to constitute an investment recommendation for, or advice to, any specific person. By providing this information, First Trust is not undertaking to give advice in any fiduciary capacity within the meaning of ERISA, the Internal Revenue Code or any other regulatory framework. Financial professionals are responsible for evaluating investment risks independently and for exercising independent judgment in determining whether investments are appropriate for their clients.
Follow First Trust:  
First Trust Portfolios L.P.  Member SIPC and FINRA. (Form CRS)   •  First Trust Advisors L.P. (Form CRS)
Home |  Important Legal Information |  Privacy Policy |  California Privacy Policy |  Business Continuity Plan |  FINRA BrokerCheck
Copyright © 2024 All rights reserved.