U.S. home sales post first gain of the year, and experts react
- Blog Post by: Jim Buchta
- May 22, 2014 - 1:02 PM
Existing home sales across the country rose modestly during April, but it was their first gain of the year, rising 1.3 percent from March to April, according to a monthly report from the National Association of Realtors.
Here's a survey of reaction from various industry players:
Jonathan Smoke, chief economist, Hanley Wood: "With all of the misdirected hand-wringing over the alleged stalling of the housing rebound in 2014, you would have thought that economists and analysts would have expected another slight decline in existing home sales...instead they were expecting a 2 percent increase to an annualized rate of 4.69 million from the 4.59 million initially reported in March. For several months now I’ve been trying to highlight the fact that the total volumes are not nearly as important as the composition of what is being sold and who is buying. You can fret all you want about the total volumes being up or down, but the reality is that the residential real estate market is getting healthier and healthier each month. The health is reflected in the share of non-distressed, normal transactions continuing to rise; more and more consumers, not investors, are buying; and prices are remaining firm amidst continued demand relative to limited supplies.
Quicken Loans Vice President, Bill Banfield: “The spring housing market may be a little late to bloom but the increase in sales is welcome news showing increased confidence in the economy. The biggest story to come out of this report is the boost in home inventory, which has been one of the key issues holding back both buyers and sellers in the first part of this year.”
Deutsche Bank: Importantly, the inventory of homes for sale rose 18.6% to 2.29M, thereby nudging the month’s supply of homes on the market at the current selling rate to 5.9, which is a relatively healthy level of inventory. Rising existing home inventories is a positive development for the housing market, because this has been a key factor weighing on transactions in the current business cycle. This morning’s data point to a Q2 rebound in housing activity following a weather-induced Q1 slowdown. This should provide policymakers modest confidence that housing activity is stabilizing.
Sterne Agee chief economist, Lindsey Piegza: "Housing activity remains tepid with the vast majority of sales in the multi-family unit space. After back-to-back months of declining sales at the start of the year, warmer spring weather hasn't been enough to create noticeable momentum in housing purchases, sentiment echoed yesterday by NY Federal Reserve President William Dudley. The rebound in sales activity in April suggests weather did play some role in the slower pace of sales since January. Sellers are also feeling a little more upbeat about the housing market, with listed inventories jumping 16.8 percent in April resulting in 2.29 million homes available for sale.
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