The National Association of Realtors (NAR) said existing home sales fell 6.4% in December, following two straight months of gains. The consensus was looking for 5.225 million, with forecasts ranging from 4.98 million to 5.4 million.
Total existing home sales — which are defined as completed transactions for single-family homes, townhomes, condominiums and co-ops — declined to a seasonally adjusted rate of 4.99 million in December. Sales are now down 10.3% from a year ago, or from 5.56 million in December 2017.
“The housing market is obviously very sensitive to mortgage rates,” NAR chief economist Lawrence Yun, said. “Softer sales in December reflected consumer search processes and contract signing activity in previous months when mortgage rates were higher than today.”
“Now, with mortgage rates lower, some revival in home sales is expected going into spring.”
The median existing-home price for all housing types was $253,600, up 2.9% from December 2017 ($246,500). This month marks the 82nd straight month of year-over-year gains.
Total housing inventory declined to 1.55 million, down from 1.74 million existing homes available for sale in November. However, it still represents an increase from 1.46 million a year ago.
Unsold inventory is at a 3.7-month supply at the current sales pace, down from 3.9 last month and up from 3.2 months a year ago.
Properties stayed on the market for an average 46 days in December, up from 42 days in November and 40 days a year ago. Thirty-nine percent (39%) of homes sold in the month of December were on the market for less than a month.
“Several consecutive months of rising inventory is a positive development for consumers and could lead to slower home price appreciation,” Mr. Yun added. “But there is still a lack of adequate inventory on the lower-priced points and too many in upper-priced points.”
Existing home sales in the Northeast declined 6.8% to an annual rate of 690,000 in December, or 6.8% below a year ago. The median price in the region was $283,400, up 8.2% from December 2017.
In the Midwest, existing home sales tumbled 11.2% to an annual rate of 1.19 million, down 10.5% overall from a year ago. The median price in the region was unchanged for the year at $191,300.
Existing home sales in the South fell 5.4% to an annual rate of 2.09 million, and are now down 8.7% from last year. The median price in the South was $224,300, up 2.5% from a year ago.
In the West, existing home sales eased back 1.9% to an annual rate of 1.02 million, and are now 15% below a year ago. The median price in the West was $374,400, up 0.2% from December 2017.