Economy Watch: Census Bureau, Black Knight Report on Home Sales

Home sales are weaker than expected in July, but still up 12.3 percent year-over-year.

Sales of new single-family houses in July reached an annualized rate of 412,000 units, the Census Bureau and the U.S. Department of Housing and Urban Development reported on Monday. That’s 2.4 percent below the revised June rate of 422,000, but still 12.3 percent higher than July 2013.

July was weaker than expected, but sales in June and May were revised upward by a combined 33,000 units. Specifically, the revision was from 406,000 units to 422,000 in June and from 442,000 units to 454,000 in May. Still, sales in the 400,000-range is historically low. During non-recessionary periods before the 2000s bubble, sales of 600,000 to 800,000 units were the norm.

Also, the Census Bureau said, the number of new houses for sale nationwide at the end of July was 205,000. This represents a supply of six months at the current sales rate, which is at the upper limit of a “normal” supply. During the worst of the recession, there was more than 12 months’ supply of housing on the market.

Black Knight Reports Declining Home Price Appreciation

In other housing news, the data and analytics division of Black Knight Financial Services (formerly the LPS Data & Analytics) released its latest Home Price Index report on Monday, based on June 2014 residential real estate transactions, which put the month-over-month increase in U.S. home prices at 0.8 percent. Since June 2013, prices have increased 5.5 percent, which represents a continued slowing-down of price appreciation. The year-over-year increases were more than 7 percent for most months in 2013, and peaked at 9 percent in both August and September, but they have been sliding ever since.

The metro area with the largest appreciation in July was Reno, Nev., coming in at 1.9 percent, with New Haven, Conn., and Greeley, Colo. tied for second at 1.5 percent. Among major metros, Dallas turned in the strongest appreciation in July, 1.2 percent, with Chicago and New York close behind at 1.1 percent. A few metros are seeing price declines, and in July, all of them happened to be in North Carolina: Durham, Winston, Wilmington, and Greensboro.

All 20 largest states and 40 largest metros again show month-over-month growth, with Nevada showing the largest monthly gain among states, while Colorado and Texas hit new highs. The Black Knight index uses the company’s property and loan-level databases to produce an analysis of non-distressed home prices every month for each of more than 18,500 U.S. Zip codes.

Wall Street started the week in good spirits on Monday, with the Dow Jones Industrial Average gaining 75.65 points, or 0.44 percent. The S&P 500 advanced 0.48 percent and the Nasdaq was up 0.41 percent.