by Calculated Risk on 9/19/2013 10:00:00 AM

The NAR reports: August Existing-Home Sales Rise, Limited Inventory Continues to Push Prices

Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, rose 1.7 percent to a seasonally adjusted annual rate of 5.48 million in August from 5.39 million in July, and are 13.2 percent higher than the 4.84 million-unit level in August 2012.

Total housing inventory at the end of August increased 0.4 percent to 2.25 million existing homes available for sale, which represents a 4.9-month supply at the current sales pace, down from a 5.0-month supply in July. Unsold inventory is 6.3 percent below a year ago, when there was a 6.0-month supply.

Click on graph for larger image.

This graph shows existing home sales, on a Seasonally Adjusted Annual Rate (SAAR) basis since 1993.

Sales in August 2013 (5.48 million SAAR) were 1.7% higher than last month, and were 13.2% above the August 2012 rate.

The second graph shows nationwide inventory for existing homes.

According to the NAR, inventory increased to 2.25 million in August up from 2.24 million in July.   Inventory is not seasonally adjusted, and inventory usually increases from the seasonal lows in December and January, and peaks in mid-to-late summer.

The third graph shows the year-over-year (YoY) change in reported existing home inventory and months-of-supply. Since inventory is not seasonally adjusted, it really helps to look at the YoY change. Note: Months-of-supply is based on the seasonally adjusted sales and not seasonally adjusted inventory.

Inventory decreased 6.25% year-over-year in August compared to August 2012. This is the 30th consecutive month with a YoY decrease in inventory, and the smallest YoY decrease since early 2011 (I expect the YoY change in inventory to turn positive soon).

Months of supply was at 4.9 months in August.

This was above expectations of sales of 5.25 million (economist Tom Lawler's forecast was closer than the consensus).  For existing home sales, the key number is inventory - and inventory is still down year-over-year, although the declines are slowing.   This was another solid report.  I'll have more later ...