Existing-home sales declined in the month of December, after two consecutive months of increases. None of the four major U.S. regions saw a gain in sales activity last month.
Total existing-home sales, or completed transactions that include single-family homes, townhomes, condominiums and co-ops, decreased 6.4 percent from November to a seasonally adjusted rate of 4.99 million in December, according to the National Association of Realtors. Sales are now down 10.3 percent compared with December 2017, 5.56 million.
"The housing market is obviously very sensitive to mortgage rates. Softer sales in December reflected consumer search processes and contract signing activity in previous months when mortgage rates were higher than today,” said Lawrence Yun, chief economist at the National Association of Realtors. “Now, with mortgage rates lower, some revival in home sales is expected going into spring."
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Lawrence Yun[/caption]
The median existing-home price for all housing types in December was $253,600, up 2.9 percent from December 2017, $246,500. December's price increase marks the 82nd straight month of year-over-year gains.
Total housing inventory at the end of December decreased to 1.55 million, down from 1.74 million existing homes available for sale in November, but it represents an increase from 1.46 million a year ago. Unsold inventory is at a 3.7-month supply at the current sales pace, down from 3.9 last month and up from 3.2 months compared to a year ago.
Properties typically stayed on the market for 46 days in December, up from 42 days in November and 40 days a year ago. Thirty-nine percent of homes sold last month were on the market for less than a month.
"Several consecutive months of rising inventory is a positive development for consumers and could lead to slower home-price appreciation," says Yun. "But there is still a lack of adequate inventory on the lower-priced points and too many in upper-priced points."
First-time buyers were responsible for 32 percent of sales in December, down from last month 33 percent, but the same as a year ago. NAR's 2018 Profile of Home Buyers and Sellers, released late last year, revealed that the annual share of first-time buyers was 33 percent.
All-cash sales accounted for 22 percent of transactions in December, up from November 21 percent and a year ago, 20 percent. Individual investors, who account for many cash sales, purchased 13 percent of homes in December, the same as November but down from a year ago, 16 percent.
Distressed sales, foreclosures and short sales, represented 2 percent of sales in December, unchanged from 2 percent last month and down from 5 percent a year ago.
Single-family and Condo/Co-op Sales
Single-family home sales sit at a seasonally adjusted annual rate of 4.45 million in December, down from 4.71 million in November, but is 10.1 percent below the 4.95 million sales pace of a year ago. The median existing single-family home price was $255,200 in December, up 2.9 percent from December 2017.
Existing condominium and co-op sales were recorded at a seasonally adjusted annual rate of 540,000 units in December, down 12.9 percent from last month and down 11.5 percent from a year ago. The median existing condo price was $240,600 in December, which is up 2.3 percent from a year ago.
Regional Breakdown
December existing-home sales in the Northeast decreased 6.8 percent to an annual rate of 690,000, 6.8 percent below a year ago. The median price in the Northeast was $283,400, which is up 8.2 percent from December 2017.
In the Midwest, existing-home sales fell 11.2 percent from last month to an annual rate of 1.19 million in December, down 10.5 percent overall from a year ago. The median price in the Midwest was $191,300, unchanged from last year.
Existing-home sales in the South dropped 5.4 percent to an annual rate of 2.09 million in December, down 8.7 percent from last year. The median price in the South was $224,300, up 2.5 percent from a year ago.
Existing-home sales in the West dipped 1.9 percent to an annual rate of 1.02 million in December, 15 percent below a year ago. The median price in the West was $374,400, up 0.2 percent from December 2017.
