For sale: 4.77 million homes

Today's report on existing home sales in November shows a slight increase in sales across the nation -- up 0.4% from last month's levels. Inventory dipped from October levels, but at 4.77 million new and existing homes for sale, remains well above year-ago levels, which could continue to pressure prices lower.

“Inventory is still high, and further reduction in prices may be required in some areas to induce buyers back into the market,” said Lawrence Yun, chief economist for the National Association of Realtors.

More from Yun: "“Near term, existing-home sales should continue to hover in a narrow range, just as they have since September, and that’s good news because it’ll be a further sign that the housing market is stabilizing."

The NAR, though, continues to lobby for aggressive rate cuts to help revive the housing market. From Reuters via CNBC: "The trade group also urged the Federal Reserve to slash interest rates by as much as three-quarters of a percentage point in January as a way to embolden home buyers."

Inventory of homes for sale on local MLS systems is running well ahead of year-ago levels in Miami (19% ahead of last year's levels), Los Angeles (26.8%), Phoenix (27%) and Las Vegas (27.5%), according to Housing Tracker.  National inventory, as estimated by the Realtors and the federal government, is running 9% ahead of year-ago levels:

               Existing    (months     New     (months     total
               homes    (to sell)      homes (to sell)      inventory
Nov. 07    4.27 m. (10.3 mo)    505,000 (9.3 mo.) 4.77 million
Nov. 06    3.83 m. (7.3 mo.)    545,000 (6.3 mo.) 4.38 million
Nov. 05    2.90 m. (5.0 mo.)    503,000 (4.9 mo.) 3.40 million
Nov. 04    2.48 m. (4.3 mo.)    418,000 (4.5 mo.) 2.90 million

Source: NAR, U.S. Dept of Commerce
Photo Credit: Reuters

 

Comments

[anon44993]

Just a quick typo. I think.
It's not 4.7 million.
It's 4.27 million. Or 4.3 million if you want to round up.

[peteviles]

Anon -- no typo. It's 4.27 existing homes for sale, plus .5 million new homes for sale, equals 4.77 million new and existing homes for sale.

[Cal]

"Inventory is still high, and further reduction in prices may be required in some areas to induce buyers back into the market"

Wow, a NAR economist quoting econ 101 stuff, scary. If realtors ever really got realistic we would be half way there to resolving this thing. They would be so much better served to just be matter of fact and present the data. There are two sides to each transaction, the NAR is clearly only representing one side and trying to cheerlead the other. Not exactly inducing confidence in their product (themselves) for these bastions of integrity.

[lefty]

and this is truly an excellent time to buy metro L.A.!! if you're really looking for great deals, it just isn't going to get much better. start building your equity now while everyone else just sits on the sidelines!!

[pugtv]

Sweeeeeetttt! The village idiot is back ... I kinda missed him when he was gone ... how are you Lefty? Bankruptcy court keeping you busy these days? Happy New Year to you and your family!

[Cal]

We need to make lefty a guest blogger, I bet he could come up with some excellent topics of discussion.

[John]

Man, I wish the NAR would change Lawrence Yun's title from "Chief Economist" to something else.

It's starting to look like he's only marginally less disingenuous then David Lereah, and we all know what happened to him, but only after months and months of absurdly misleading predictions.

Seriously, if the NAR wants to improve the image of Realtors, and give them any hope whatsoever as being perceived as knowledgeable, honest, ethical individuals, they've got to lead by example.

"Further sign that the market is stabilizing"?

Honestly? Maybe the market is as stable as an aerodynamic falling knife, but that's about it.

Don't get me wrong, I think hardworking homeowners should be entitled to a fair return on their investment, but thinking that astronomic but baseless increases in home value don't have to be balanced by significant and potentially disastrous corrections is just wishful thinking.

[Keith]

"it just isn't going to get much better." - Lefty

It is always possible to find a grain of truth in a soup of ....

[Roger Moore]

"I think hardworking homeowners should be entitled to a fair return on their investment, but thinking that astronomic but baseless increases in home value don't have to be balanced by significant and potentially disastrous corrections is just wishful thinking." --John

I don't think hardworking homeowners are "entitled" to anything. Any investment is a gamble, not a guarantee, and there's always some risk of winding up with less than you started with.

And at the core, the idea of a home (primary residence) as an investment is a terrible idea. Home prices have a significant constraint. Their value is based on people's ability to pay for them, so they can't go up much faster than incomes. At best, a homeowner can reasonably expect to get use value (i.e. the benefit of living there) and income growth from his house. At worst, he will wind up losing money from interest, taxes, insurance, and maintenance. Long term high rates of return are only possible with productive, revenue generating assets: stocks, bonds, rent generating property, etc.