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Since existing home sales are less important for economic purposes, and especially with new home sales being reported tomorrow morning, I will keep this brief.What we are looking for is rebalancing in the housing market. For that to happen, we want the inventory of existing homes to increase, prices to stabilize, and sales to gradually pick up.In June we got two out of three.The inventory of homes for sale increased to 1.32 M. This series is not seasonally adjusted, so we look YoY, and there we find that this is the highest inventory for June since 2020:
Meanwhile, the YoY% gain in prices was 4.1%. This metric is also not seasonally adjusted, and there we got the lowest YoY% increase since last December:
But sales of existing homes declined 0.22 M annualized in June to 3.89 M. This is at the bottom of its range in the past 12 months, and reflects the increase in mortgage rates several months ago:
So, inventory is increasing, and prices are increasing at a slower pace, but sales are not picking up at all, at least not with the mortgage rates of 7% we saw several months ago.I’ll compare with the situation as to new houses tomorrow.More By This Author:How Restrictive Are Real Interest Rates?
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