12: Existing and Pending Home Sales Reports - ECONOMIC REPORTS FOR ALL MARKETS
This is the 12th video in a series on economic reports created for all markets, or for those who simply have an interest in economics. In this lesson we cover the Existing Home Sales Report and Pending Home Sales Index .
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Link to the Existing Home Sales Report:
http://www.realtor.org/research/research/ehsdata
Link to the Pending Home Sales Index:
http://www.realtor.org/research/research/phsdata
Text From Video:
The Existing Home Sales report, and the Pending Home Sales Index.
The Existing Home Sales report and the Pending Home Sales Index are 2 separate reports by the National Association of Realtors that monitor the sales of homes in the US. I'll post links for both reports in the text next to the video.
The Existing Home Sales report monitors the monthly sales of existing, or previously owned homes.
The report is issued monthly by the National Association of Realtors on or near the 25th of each month.
Home sales show the level of demand in the country. When the economy is doing well, more people buy homes. When the economy is doing poorly, less people buy homes. Also, when home sales increase, consumers tend to spend more on durable goods such as furnature and appliances.
A large part of the driving force for home sales is interest rates. Home prices begin to rise when demand goes up in the country Interest rates are raised to lower demand. Eventually interest rates and home prices will rise to a point that home sales will begin to decline.
Home prices begin to decline when demand is down in the country. Interest rates are lowered to increase demand. Eventually interest rates and home prices become low enough that home buying begins to increase again.
Because of this relationship, changes in home buying trends are a good indicator for turning points in the economy.
Looking at the report itself-
The report contains two tables, as well as a summary with opinions as to the causes for changes in sales.
Because home sales are greatly effected by things like changes in weather, the report provides the statistics both seaonally adjusted and not seasonally adjusted.
The first table contains the quantity of sales of existing homes, plus the inventory of availble homes for sale.
The second table contains the average prices the homes sold for.
The table for Existing Home Sales shows the number of homes sold per month for the entire US. Next to that is the number of homes sold in just the Northeast, the Midwest, the South, and the West.
On the bottom of the page is the percent of change in sales from the previous month and percent of change from the previous year.
On the right side of table are number of homes for sale, also known as the inventory level
Next to that is the number of months supply. This is the length of time it will take to sell all the homes presently for sale. Another way to look at this is that it is the average time it takes to sell a home that has just been placed on the market.
Just like in the other sections, at the bottom of the column is rate of change in inventory and supply from the previous month and from the previous year, with both statistics being presented as a percent of change.
Inventory levels show the level of supply in the country. When inventory levels increase, home prices drop. When inventory decline, home prices rise.
The most important statistics reported in the media are the seasonally adjusted number of homes sold, the inventory level, and the monthly percent of change for both.
The second table shows the Sales Price of Existing Homes.
The Sales Prices for Existing Homes table shows both the average price and median price for all homes sold in the US, as well as homes sold in just the Northeast, the Midwest, the South, and the West.
Economists compare the change in home prices to inflation rates to see if homes are an attractive investment.
Music:
Existing Home Sales:
Danse Macabre - Low Strings Finale (Theme)
Exotic Battle, Machinations, Monkoto
Kevin MacLeod incompetech.com
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13: New Home Sales Reportby InformedTrades16,310 views
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