Last Week’s Economic News in Review-Dec 30
Sales of existing and new homes both declined, but continued to outperform last year. Meanwhile, layoffs saw mixed activity.
Existing Home Sales
Existing home sales ended a streak of monthly gains in November. Transactions of existing single-family homes, townhomes, condos and co-ops declined 2.5 percent in the month to an annual rate of 6.69 million, according to last week’s report from the National Association of Realtors.
That said, housing continues to perform well despite the coronavirus health emergency. When compared to the same period a year ago, November’s sales were 25.8 percent higher than November 2019’s rate of 5.32 million.
“Home sales in November took a marginal step back, but sales for all of 2020 are already on pace to surpass last year’s levels,” NAR Chief Economist Lawrence Yun noted in comments accompanying NAR’s report. “Given the COVID-19 pandemic, it’s amazing that the housing sector is outperforming expectations.”
Looking at price, November’s median price for all existing homes of all types was $310,800 which marked a 14.6 percent increase over November 2019’s median price of $271,300. This was the 105th consecutive month of year-over-year gains.
The number of existing homes for sale at the end of November dropped to 1.28 million units, which represented a 2.3-month supply at November’s sale pace. November’s inventory was 9.9 percent off from October and 22 percent below November 2019.
New Home Sales
In related news, sales of new, single-family homes sharply declined to an annual rate of 841,000 in November, which was 11 percent below October’s pace of 945,000, the Census Bureau and the Department of Housing and Urban Development reported last week.
This marked a five-month low, but when compared to the same period a year ago, October’s sales were 20.8 percent higher than October 2019’s rate of 696,000.
Looking at pricing, the median price for new single-family homes sold in November was $335,300, which was 2.22 percent higher than October 2019’s median price of $328,000.
In terms of inventory, the estimated number of new homes for sale at the end of November totaled 286,000 representing a 4.1-month supply at October’s sales rate.
Initial Jobless Claims
Turning to employment news, first-time claims for unemployment benefits filed by recently unemployed Americans during the week ending December 19th dropped to 803,000, which was 89,000 claims lower than the preceding week’s total of 892,000, the Employment and Training Administration reported last week.
The four-week moving average – regarded as a more reliable measure of jobless claims – grew to 818,250 claims, which was 4,000 claims up from the previous week’s average of 814,250.
Many employment watchers were crossing their fingers that the COVID-19 aid package (yet to be signed at the time) would be a good step toward supporting jobless Americans, given its additional unemployment insurance and extended eviction moratorium.
“For those that can’t find work, the extra claims will obviously help them,” Peter Boockvar, chief investment officer at Bleakley Advisory Group, noted in a public statement. “Either way, come spring and summer, we hope that we’ll see a sharp decline in all these numbers.”
This week, we will see an extremely light calendar of economic releases due to the winter holiday season and New Year’s:
Thursday – Initial jobless claims for last week from the Employment and Training Administration.
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