While the housing industry waits for official figures to be released, Auction.com is forecasting that annual existing-home sales in November were in the range of 5.19 million to 5.54 million, with a targeted number of 5.36 million.
Although this is basically flat compared with October, it is an increase of 8.4% compared with November 2014, according to the firm's Real Estate Nowcast report.
‘People looking to buy a home today face dual constraints – extraordinarily low inventory and extremely tight credit,’ says Rick Sharga, executive vice president of Auction.com, in a release. ‘But, demand may be weakening as well, since the number of first-time home buyers continues to be lower than normal, and purchases by investors – especially investors from China and Europe – appear to be slowing down a little bit, as well. It will be interesting to see what happens to demand if the Fed raises rates in December and lenders respond by hiking mortgage interest rates.’
Existing-home sales for October were at an annual rate of 5.36 million, a decrease of 3.4% compared with September but an increase of 3.9% compared with October 2014, according to the National Association of Realtors.
Although existing-home sales gains have stagnated since May, Peter Muoio, chief economist for Auction.com, says the leveling off was expected. He notes that the plateau corresponds with a soft spot in the economy, some downshifting in job growth and the financial market turbulence experienced in late summer.
‘The renewed strength of the labor market, including accelerating wage gains, should be good news for the housing market heading into 2016,’ Muoio says. ‘We continue to look for higher home prices to coax more sellers into the market. Along with wages, this could be an important new ingredient to the 2016 housing story.’