By Dr Denver H. Bubble
Existing-home sales ran at a seasonally adjusted annual 5.32 million pace in November, the National Association of Realtors said this past week. November marked the second month of increasing sales and sales were 1.9% higher than in October, but 7.0% lower than a year ago. Homes stayed on the market for an average of 42 days in November, up from 36 days in October and 40 days from a year ago, but currently, the available supply of home would last about 4 months, down from October. Traditionally a sign of a market balanced between supply and demand is six months of inventory. So national we are still below a normal balanced market for housing inventory. Denver normally in November has an inventory of 14,926 homes and in November 2018 was at 7,530. So while the increase of 46.76% year over year is very high, we are still very tight in terms of inventory.
In the Northeast, sales jumped 7.2%, while in the Midwest they rose 5.5%. Sales in the South ticked up 2.3%. However, the West, Denver’s region, saw the only decline, with sales down 6.3%.
Most forecasters are focusing on the drop in long-term mortgage rates recently with the yield on the Treasuries falling. However, buyers will be seeing a decline in purchasing power due to the wealth effect with the recent drops in the stock market. 2019 is shaping up to a worse year than 2018 for the housing bubble.