by Calculated Risk on 6/21/2022 10:55:00 AM
Today, in the CalculatedRisk Real Estate Newsletter: NAR: Existing-Home Sales Decreased to 5.41 million SAAR in May
Sales in May (5.41 million SAAR) were down 3.4% from the previous month and were 8.6% below the May 2021 sales rate. Sales in April were revised down.
The second graph shows existing home sales by month for 2021 and 2022.
Sales declined 8.6% year-over-year compared to April 2021. This was the ninth consecutive month with sales down year-over-year.
Key point on Timing of Sales
Existing home sales are reported when the transaction closes. So, sales in May are mostly for contracts signed in March and April when mortgage rates were significantly lower than today (and many buyers locked in the mortgage rate as soon as possible).
30-year mortgage rates in March were around 4.2% according to Freddie Mac. And rates increased to around 5% in April. Now rates are slightly over 6%.
My sense is contracts for sales really declined in June, and that will show up as closed sales in July and August.
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