From the WSJ:
Sales of previously owned homes tumbled to a six-month low in November, a sign the housing market continues to underperform despite a burst of stronger economic growth.
Existing-home sales declined 6.1% in November from a month earlier to a seasonally adjusted annual rate of 4.93 million, the National Association of Realtors said Monday. That was the lowest level since May.
November’s sales were 2.1% higher than a year ago and followed a particularly strong October, when sales reached their highest level of the year.
The outlook remains cloudy because borrowing costs are expected to rise next year if the Federal Reserve follows through on plans to raise short-term interest rates, which have been near zero since the recession.
The average rate on a 30-year fixed-rate mortgage fell to 3.80% last week, according to Freddie Mac, down from 4.53% at the start of the year. Meantime, the U.S. is on track to post its strongest year of job growth since 1999.
“The weaker existing-home sales report suggests that the housing market remains on a somewhat rocky footing as data remains quite choppy,” said Gennadiy Goldberg, economist at TD Securities. “We suspect that the recent decline in mortgage rates could help provide a near-term boost to activity over the coming months, but believe that further housing market improvement is likely to remain quite gradual, remaining a source of concern for the Fed.”
Monday’s report showed that in November, existing-home sales fell in all four major regions—the Northeast, South, West, and Midwest.
Inventories tightened. The number of homes for sale fell 6.7% in November from a month earlier to 2.09 million. At the current sales pace, it would take 5.1 months to exhaust the supply of homes on the market.
The median sale price for existing homes continued to rise, hitting $205,300, or 5.0% above the year-ago level.
Details suggest a slight shift in the mix of buyers. So-called distressed sales, reflecting short sales and homes in foreclosure, were flat, suggesting fewer investors are snapping up properties. Meantime, the share of sales going to first-time buyers ticked up to 31% last month, the highest since October 2012 but still historically low.