Filed under: Bad news, Economic data, Housing, Recession

Sales of existing homes in April 2008 fell 1.0%, to a seasonally-adjusted annualized rate of 4.89 million, the National Association of Realtors announced Friday, as inventories of homes swelled to a 23-year high.

Economists surveyed by Bloomberg News had expected April 2008 existing home sales to total a 4.85-million annualized rate. The March 2008 sales rate was revised higher to a 4.94-million annualized rate.

Even more telling, inventories — unsold homes and condominiums — rose to an 11.2-month supply at the current sales rate. A typical, healthy housing market has a three to four month supply of unsold homes on the market.

Further, the inventory of single family homes rose to 10.7-month supply - - its highest level since 1985. Meanwhile, the inventory of condominiums increased to a 14.2-month supply.

Also, the median sales price for houses and condominiums fell to $202,300 in April 2008, an 8% decrease from the $219,900 median recorded a year ago.

Existing home sales varied by region. Sales fell 6.0% in the Midwest, declined 4.4% in Northeast, were unchanged in the South, but rose 6.4% in the West.

Economic Analysis: Another bearish housing report. The report indicates Americans are continuing to delay their home purchases, which is rational, given the likely continued decline in home prices, save for a few isolated (and fortunate) markets/cities. The housing sector remains in a pronounced recession — its worst slump in more than 15 years.

Further, as the housing slump continues, each month it seems to contain another record-breaking stat: this month it was the inventory of single family homes, which reached its highest level — 10.7 months — since 1985. Moreover, given the housing sector’s relationship to U.S. GDP growth, housing’s continued doldrums point to continued overall U.S. economic sluggishness through at least Q2 2008, and most likely through Q3 2008.

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This entry was posted on Monday, May 26th, 2008 at 2:15 pm and is filed under Real Estate and Housing. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.