Sales of U.S. Existing Homes Decrease to Nine-Month Low

[Purveyor]

Source: Bloomberg

10:02 AM EST February 23, 2015

(Bloomberg) -- Sales of previously owned U.S. homes fell more than expected in January as a tight supply forced up prices, showing the residential real-estate market faces an uneven recovery.

Purchases slowed 4.9 percent to a 4.82 million annualized rate, the least since April, after a 5.07 million pace that was higher than previously estimated, figures from the National Association of Realtors showed Monday in Washington. The median forecast of 74 economists in a Bloomberg survey called for a fall to 4.95 million.

The number of houses on the market dropped in January for a second straight month compared with last year and price increases were broad-based, making it difficult for first-time and younger buyers to get into the market. Gains in employment and historically low mortgage rates will probably sustain demand, while rising household formation and a shortage in rental supply should also provide a boost this year over last.

“We’re starting to see big concerns about pricing and affordability,” said Jacob Oubina, a senior economist at RBC Capital Markets LLC in New York, who’s forecast that sales would drop to a 4.8 million pace was the closest in the Bloomberg survey. “There is concern about lack of supply of affordable housing and we’re not just talking about cheap housing. Folks are finding out they are priced out of the market.”

Read more: http://www.bloomberg.com/news/articles/2015-02-23/sales-of-u-s-existing-homes-fell-to-nine-month-low-in-january

[aquart]

1. Uh oh.

[titaniumsalute]

2. A couple of points

Sales in January are typically sluggish. But this January has proven to be a real stinker with weather. Weather certainly impacts the housing market and with a HUGE part of the country in a terrible winter scenario this year, I can't see how home sales would be good.

It also seems like fewer people recently are moving. Maybe the downturn in 2008 has taught people that spending more than they should on housing and real estate is not a good idea.