Mornings like this can drive you nuts. Lots of numbers, lots of talk about gains or declines, and lots of cherry-picking figures — month-to-month comparisons, year-over-year comparisons, raw numbers, adjusted numbers, etc. — by doomsayers and the sunshine set alike.
Here’s just a sampling of the stories coming across our news reader this morning.
From MSNBC, “Existing-home sales rose 7.6% in August”:
Sales rose 7.6 percent in August from July to a seasonally adjusted annual rate of 4.13 million, the National Association of Realtors said Thursday. Sales were down 19 percent from the same month a year earlier.
July was the worst month for sales in 15 years. That was unchanged by a slightly upward revision.
…Potential buyers are still nervous, said Eric Matz, a real estate agent with Coldwell Banker in the San Diego area.
“Nobody wants to see their investment go down after they buy it,” he said. “It’s as tough as I’ve ever seen it.”
Homebuilders, who normally power economic recoveries, have kept construction low rather than try to compete with all the unsold properties. With nearly 4 million homes on the market, it would take about a year to exhaust that supply at the current sales pace.
From Bloomberg, “Home sales in US likely rose to second-lowest on record”:
“Housing is showing no ability to move to the upside,” said Eric Green, chief market economist at TD Securities Inc. in New York. It will take gains in employment, an improvement in confidence and a decline in the number of houses on the market for the industry to rebound, he said.
Economists surveyed project the jobless rate will average more than 9 percent through 2011, undermining confidence and signaling foreclosures will hinder real estate as households struggle to make mortgage payments. A distressed housing market was among reasons the Federal Reserve cited this week when it said it’s willing to take additional steps to spur growth.
From the Illinois Association of Realtors, “Illinois home sales in August improve from July”:
In the city of Chicago, August total home sales (single-family and condominiums) were down 22.9 percent to 1,486 sales compared to 1,927 homes sold in August 2009. The city of Chicago median price in August 2010 was $200,000, down 13.0 percent compared to $229,900 a year ago in August 2009.
Year-to-date sales remain up by 17.2 percent January through August 2010 with 13,883 sales compared to 11,842 home sales for the same period in 2009. The year-to-date median sales price for the city of Chicago is down 6.4 percent to $214,500 from $229,276 for 2009.
“The market year-to-date in the city of Chicago reflects an increase in the number of units sold by more than 17 percent over the same period in 2009,” said REALTOR® Genie Birch, president of the Chicago Association of REALTORS® and a broker associate with Koenig & Strey Real Living, Chicago. “Consumers continue to find Chicago real estate worthy of their investment, and are making sound decisions regarding how they spend their money and plan for their future.”
From Calucated Risk, “Existing home sales at 4.1 million SAAR, 11.6 months of supply”:
Inventory is not seasonally adjusted and there is a clear seasonal pattern with inventory increasing in the spring and into the summer…Months of supply decreased to 11.6 months in August from 12.5 months in July. This is extremely high and suggests prices, as measured by the repeat sales indexes like Case-Shiller and CoreLogic, will continue to decline.
These weak numbers are exactly what I expected. Ignore the median price! Double digit supply and the low sales rate are the key stories.