by Calculated Risk on 2/23/2015 10:00:00 AM

The NAR reports: Existing-Home Sales Cool in January As Available Inventory Remains Subdued

Total existing-home sale1, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, fell 4.9 percent to a seasonally adjusted annual rate of 4.82 million in January (lowest since last April at 4.75 million) from an upwardly-revised 5.07 million in December. Despite January’s decline, sales are higher by 3.2 percent than a year ago. ...

Total housing inventory at the end of January increased 0.5 percent to 1.87 million existing homes available for sale, but is 0.5 percent lower than a year ago (1.88 million). Unsold inventory is at a 4.7-month supply at the current sales pace – up from 4.4 months in December.

Click on graph for larger image.

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

Sales in January (4.82 million SAAR) were 4.9% lower than last month, and were 3.2% above the January 2014 rate.

The second graph shows nationwide inventory for existing homes.

According to the NAR, inventory increased to 1.87 million in January from 1.86 million in December.   Headline inventory is not seasonally adjusted, and inventory usually decreases to 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 0.5% year-over-year in January compared to January 2014.  

Months of supply was at 4.7 months in January.

This was below expectations of sales of 5.00 million.  For existing home sales, a key number is inventory - and inventory is still low.    I'll have more later ...