by Calculated Risk on 6/21/2017 12:42:00 PM

Earlier: NAR: "Existing-Home Sales Rise 1.1 Percent in May"

Two key points:

1) As usual, housing economist Tom Lawler's forecast was closer to the NAR report than the consensus.  The NAR reported sales of  5.62 million SAAR, Lawler projected 5.65 million SAAR, and the consensus was 5.55 million SAAR.  See: Lawler: Early Read on Existing Home Sales in May

"I project that US existing home sales as estimated by the National Association of Realtors ran at a seasonally adjusted annual rate of 5.65 million in May, up 1.4% from April’s preliminary pace and up 3.3% from last May’s seasonally adjusted pace."

2) Inventory is still very low and falling year-over-year (down 8.4% year-over-year in May).

I started the year expecting inventory would be increasing year-over-year by the end of 2017. That now seems unlikely, but still possible.

More inventory would probably mean smaller price increases, and less inventory somewhat larger price increases.

The following graph shows existing home sales Not Seasonally Adjusted (NSA).

Click on graph for larger image.

Sales NSA in May (red column) were above May2016. (NSA) - and the highest for May since 2006.

Note that sales NSA are now in the seasonally strong period (March through September).