The headlines for existing home sales say “home sales in August lost some momentum to close out the summer“. Our analysis of the unadjusted data shows that home sales were soft – but that the rolling averages did improve. Overall, existing home sales appear to continue in the long term improvement trend channel..

Econintersect Analysis:

NAR reported:

Unadjusted Year-over-Year Change in Existing Home Sales Volumes (blue line) – 3 Month Rolling Average (red line)

The graph below presents unadjusted home sales volumes.

Unadjusted Monthly Home Sales Volumes

Here are the headline words from the NAR analysts:

Lawrence Yun, NAR chief economist, says home sales in August lost some momentum to close out the summer. “Sales activity was down in many parts of the country last month — especially in the South and West — as the persistent summer theme of tight inventory levels likely deterred some buyers,” he said. “The good news for the housing market is that price appreciation the last two months has started to moderate from the unhealthier rate of growth seen earlier this year.”

“With sales and overall demand higher than a year ago and supply mostly unchanged, low inventories will likely continue to limit options for those looking to buy this fall even with the overall pool of buyers shrinking because of seasonal factors,” adds Yun.

“When the Federal Reserve decides to lift short-term rates — likely later this year — the impact on mortgage rates and overall housing demand will likely not be pronounced,” says Yun. “With job growth holding steady, prospective buyers can handle any gradual rise in mortgage rates — especially if today’s stronger labor market finally leads to a boost in wages and homebuilding accelerates to alleviate supply shortages and slow price growth in some markets.”

NAR President Chris Polychron says Realtors® worked hard over the summer to prepare for the Oct. 3 implementation of Know Before You Owe, also known as the TILA-RESPA Integrated Disclosure rule. “A large majority of Realtors® have taken some form of training to prepare for the new disclosure requirements,” he said. “As the ruling goes into effect next month, communication is crucial between all parties involved in a real estate transaction to ensure consumers get to closing seamlessly and without delay. NAR will monitor the progress of the rule in the weeks ahead and will share any concerns that arise as part of our continued partnership with the Consumer Financial Protection Bureau.”