Existing home sales, housing starts reach multi-year highs
Analysts differ in opinion about what constitutes “real progress” for the housing recovery. After today’s data, count the Wall Street Journal Developments blog in the “housing market recovery” bandwagon.
In an article titled, “Housing: Finally on the Path to Recovery“, Nick Timiraos referenced existing home sales and housing starts as evidence that the housing market has overcome a listless summer economy to “climb out of a deep hole.”
Existing home sales jump to 2-year high || LINK
In August, existing home sales rose to the highest level in 27 months. Sales are up 7.8 percent from July and 9.3 percent from the previous year.
The supply of existing homes for sale on the market is 6.1 months, which is right around the “healthy” market levee lot six months.
Housing starts growing slightly || LINK
Starts for construction on single-family homes in August hit the highest mark in 28 months. The seasonally adjusted annual rate comes in at 750,000 units, which is below the 2.27 million peak during January 2006, but still an improvement.
From the CNBC article, we learn that residential construction accounts for 2.5 percent of GDP and creates three new jobs per house built.
Housing inventory down 18.2 percent year-over-year || LINK
Part of the reason home prices have recovered is the decline of supply on the market. Housing inventory fell 18.2 percent from the previous year, but rose 2.9 percent from July, according to the National Association of Realtors.
Stocks finished the day with slight gains after these better-than-expected housing reports.
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