The housing sector is showing traction as existing home sales extended May’s gain, rising 1.1 percent to a 5.570 million annualized rate for June which is the best of the cycle, since February 2007. Single-family sales rose a very solid 0.8 percent in the month for a plus 3.1 percent year-on-year rate with condos up 3.2 percent for a plus 1.6 percent on-year rate. The total year-on-year rate is modest but constructive at plus 3.0 percent.
The gain in June did not come at the expense of pricing as the median rose 3.7 percent to $247,700 for a year-on-year rate of plus 4.7 percent which is slightly ahead of the sales rate. A plus for pricing is lack of homes on the market which, however, is a major negative for sales growth. Supply fell 0.9 percent in the month to 2.12 million with supply relative to sales falling to 4.6 months from 4.7 months.
Regional sales data are well balanced with the Northeast out in front at a year-on-year plus 5.6 percent and the West bringing up the rear but only at minus 0.8 percent. The Midwest and South, like the Northeast, are in the positive low single-digits.
Sales rates all this year, including for new homes, have been trending slightly higher — but the direction is definitely forward. And steady growth is the recipe for the housing sector which occasionally suffers from boom-and-bust.