From the WSJ:
Sales of previously owned homes plummeted in November as delays caused by new mortgage red-tape and a dwindling supply of residences on the market pushed down sales to a level not seen since April 2014.
Existing-home sales fell 10.5% last month to a seasonally adjusted annualized rate of 4.76 million, the National Association of Realtors said Tuesday, well below the 5.32 million economists expected. The double-digit decline was the sharpest since July 2010, when sales took a hit from the expiration of a home-buyer tax credit.
The NAR blamed the lion’s share of the November decline on closing delays caused by new federal rules implemented by the Consumer Financial Protection Bureau in October, although it said rising home prices and tight inventory continued to challenge potential buyers.
Several realtors said pressure on housing inventories is also driving the sales slump. The number of existing homes for sale fell more than 3% on the month in November and was down nearly 2% on the year.
“I think we’re still seeing a fair amount of tightness in active selling markets,” said Zillow Chief Economist Svenja Gudell, adding first-time buyers trying to enter the market at a lower price point are facing particular scarcity. Housing prices have also climbed faster than wages in many markets, making it more difficult for first-time buyers to save for a down payment.
In November, the national median home price rose to $220,300, the 45th consecutive month of gains year over year, and 6.3% higher than the same month last year.
Despite November’s decline, NAR said home sales are on track for their best year since the current economic expansion began. Economists said the underlying sales rate appears steady, despite the rule changes causing turbulence last month.