Existing home sales finally took a breather in November,
breaking a five month stretch of gains, often substantial ones. The National
Association of Realtors® (NAR) said that pre-owned single-family homes,
townhomes, condos, and cooperative apartments sold at a seasonally adjusted
annual rate of 6.69 million units, a 2.5 percent decline from October’s 6.85
million pace. Sales were still 25.8 percent higher than the 5.32 million rate
of sales in November 2019.
Sales were slightly below the estimates of analysts polled by
both Trading Economics and Econoday. They had forecast sales of
6.71 million and 6.72 million, respectively.
Single-family homes sold at a seasonally
adjusted annual rate of 5.98 million, 2.4 percent off the October pace and existing
condo sales fell 2.7 percent to 710,000 units. Each remain significantly higher
than sales in November 2019; single-family sales gained 25.6 percent and condo
sales rose 26.8 percent.
“Home sales in November took a
marginal step back, but sales for all of 2020 are already on pace to surpass
last year’s levels,” said Lawrence Yun, NAR’s chief economist. “Given the
COVID-19 pandemic, it’s amazing that the housing sector is outperforming
Yun notes that job recoveries have
stalled in the past few months, and fast-rising coronavirus cases along with
stricter lockdowns have weakened consumer confidence.
“Circumstances are far from being
back to the pre-pandemic normal,” he said. “However, the latest stimulus
package and with the vaccine distribution underway, and a very strong demand
for homeownership still prevalent, robust growth is forthcoming for
Sales may be down, but price
increases continued unabated. November marked the 105th straight
month of year-over-year appreciation. The median existing-home price for all
housing types in November was $310,800, up 14.6 percent from the prior November’s
median of $271,300. The median existing single-family home price rose 15.1
percent to $315,500 and there was a 9.5 percent gain in the median condo price to
Listing also declined at the end of November, 9.9 percent fewer than in
October and down 22 percent from one year ago when the total was 1.64 million. Current
listings are estimated at a 2.3-month supply at the current sales pace, an
all-time low. In October, the supply was estimated at 2.5 months and at 3.7-months
in November 2019.
Properties typically remained on the market for
21 days in November, seasonally even with October and down from 38 days in
November 2019. Seventy-three percent
of the homes sold in November 2020 were on the market for less than a month.
which had greatly benefitted from falling mortgage rates, are now being
challenged due to record-high home prices,” Yun said. “That could place strain
on some potential consumers, particularly first-time buyers.”
Those novice buyers were
responsible for 32 percent of sales in November, unchanged from both October 2020
and November 2019. Individual investors or second-home
buyers, who account for many cash sales, purchased 14 percent of homes in
November and 20 percent of transactions were all-cash. Distressed sales accounted
for less than 1 percent of the total.
Sales slipped in all four major
regions in November but increased year over year by double digits as did median
November’s existing-home sales in
the Northeast dropped 2.2 percent from October to an annual rate of 880,000 units
but were 25.7 percent higher than a year earlier. The median price in the
Northeast was $354,100, up 17.4 percent from November 2019.
Existing-home sales fell 2.5 percent
in the Midwest to an annual rate of 1,590,000. Sales were 24.2 percent higher
year-over-year. There was a 14.6 percent growth in the region’s median price,
Sales in the South fell 3.8 percent
to an annual rate of 2.82 million units but were 25.9 percent higher on an
annual basis. The median price was $270,000, a 15.0 percent increase from a year
Sales in the West were unchanged on
a monthly basis at 1.40 million units but that represented 27.3 percent annual growth.
The median price increased 13.8 percent to $467,600.