Existing single-family home sales decelerated -0.83% m/m, its twelfth consecutive month in negative territory. On a y/y basis, existing single-family home sales decelerated -36.12%, which is the fastest deceleration on record. The median sales price for all existing homes price decelerated to 1.33% y/y, its ninth consecutive deceleration, and the comparison set gets tougher through June. Months’ supply of single-family homes ticked up to 2.9, but remains well below the historical average of 6.4.
New home sales accelerated 7.20% m/m, following the same increase in December. However, the y/y pace slowed to -19.37% which marks its eleventh consecutive month in negative territory. The median sales for new homes decelerated -8.18% m/m, its fastest deceleration since September 2014. On a y/y basis, prices fell to -0.70% y/y, its first print in the negative since August 2020. Months’ supply of new homes decreased to 7.9, which is above its historical average.
Weakness in the housing market partly reflects the rise in mortgage rates due to it being one of the more interest rate sensitive areas of the economy. Despite prices coming down, the absolute levels remain historically elevated which may also be contributing to the slowdown as consumer incomes have decelerated on a real basis. We will continue to monitor this situation as the ramifications of a housing slowdown will likely have a negative impact on the broader economy.
The views expressed herein are presented for informational purposes only and are not intended as a recommendation to invest in any particular asset class or security or as a promise of future performance. The information, opinions, and views contained herein are current only as of the date hereof and are subject to change at any time without prior notice.
Senior Economic Analyst
Boyd Watterson Asset Management, LLC