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October Existing Home Sales Slow Down According to Auction.com Real Estate Nowcast
Auction.com Model Projects October Sales will Return to Early Summer Levels at 5.44 Million Units (SAAR); Median Sales Price Falls to $225,546

IRVINE AND SILICON VALLEY, Calif. – Nov. 2, 2015 - Auction.com, LLC, the nation’s leading online real estate marketplace, has released its latest Auction.com Real Estate Nowcast which projects that existing home sales for the month of October will fall between seasonally adjusted annual rates of 5.26 and 5.61 million annual sales, with a targeted number of 5.44 million – down 2 percent from September, but still in line with early summer sales.

“Challenges on both the supply and demand side appear to be slowing down existing home sales,” said Auction.com Executive Vice President Rick Sharga. “Inventory levels remain stubbornly low, especially for entry-level buyers, despite rising home prices, and credit is still very tight for the average borrower. The good news is that, considering the weaker than expected jobs numbers, and the usual seasonal dip in purchase activity, it doesn’t appear that sales will fall off significantly for the balance of the year.”

Earlier this month, the National Association of Realtors® (NAR®) released its existing home sales data for September, reporting a 4.7 percent increase in home sales to 5.55 million units following August’s sudden drop off and confirming Auction.com’s expectation that August’s apparent decline was an aberration. This increase in the national sales pace resulted from gains in all regions of the country. 

“The recent drop in housing followed by what appears to be a return to modest growth reminds all of us of a key economics lesson: to not overreact to a single month of data,” said Auction.com Chief Economist Peter Muoio. “While last month’s housing data caused a bit of a stir among economists, industry professionals and the media, the fact is the housing market remains strong. The recent weakening of job growth is something that we are watching closely for any impact on home demand, but consumer confidence continues to rise and households are noticeably benefitting from lower energy prices.”

Home prices also remain healthy according to Auction.com’s findings. NAR reported a 6.1 percent year-over-year increase in median existing home prices September to $221,900 – close to the median price of $227,760 that Auction.com predicted last month. Findings from the Auction.com Real Estate Nowcast suggest that sales prices for existing homes will fall between $214,269 and $236,824 in the month of October, with a targeted price of $225,546. This represents an 8.7 percent year-over-year increase.

About the Auction.com Real Estate Nowcast Model

The Auction.com Real Estate Nowcast combines industry data, proprietary company transactional data and Google search activity to predict market trends as they are occurring – weeks before the findings of other benchmark studies are released. Building upon the groundbreaking work by Google Chief Economist Hal Varian, Auction.com’s nowcast model extends a traditional autoregressive-forecasting model to incorporate contemporaneous information that provides significantly enhanced accuracy.

Auction.com will occasionally update its nowcast as fresh data provides additional signals for current home sales activity. The Auction.com Real Estate Nowcast model has proven highly accurate over the course of 2014 and into 2015.

Existing Home Sales

Month

Reported Existing Home Sales

(in millions)

Auction.com Point Estimate

(SAR in millions)

Auction.com Predicted Range

(SAR in millions)

August 2014

5.00

5.19

5.09 – 5.30

September 2014

5.10

5.08

4.91 – 5.24

October 2014

5.16

5.13

4.96 – 5.30

November 2014

4.95

5.16

4.99 – 5.33

December 2014

5.07

5.03

4.85 – 5.21

January 2015

4.82

5.01

4.83 – 5.19

February 2015

4.89

5.03

4.87 – 5.19

March 2015

5.19

5.06

4.90 - 5.22

April 2015

5.04

5.33

5.16 – 5.50

May 2015

5.32

5.31

5.14 – 5.48

June 2015

5.48

5.53

5.35 – 5.71

July 2015

5.58

5.56

5.38 – 5.74

August 2015

5.31

5.64

5.46 – 5.82

September 2015

5.55

5.40

5.23 – 5.57

October 2015

TBD

5.44

5.26 – 5.51

 

Sources: Google, NAR, Auction.com

Existing Home Sales Pricing

Month

Reported Existing Home Price

YoY % Change

Auction.com Point Estimate

YoY % Change

Auction.com Predicted Range

August 2014

$218,400

4.1%

$219,148

4.5%

$208,190 - $230,105

September 2014

$209,100

5.3%

$214,433

8%

$203,712 - $225,155

October 2014

$207,500

5.1%

$205,922

4.3%

$195,626 - $216,218

November 2014

$207,200

6%

$204,204

4.5%

$193,993 - $214,414

December 2014

$208,200

5.3%

$205,783

4.1%

$195,493 - $216,072

January 2015

$197,600

5.2%

$205,126

9.2%

$194,869 - $215,382

February 2015

$201,900

7.2%

$201,077

6.7%

$191,023 - $211,131

March 2015

$210,700

7.1%

$204,165

3.8%

$193,956 - $214,373

April 2015

$219,400

8.9%

$211,633

5%

$201,052 - $222,215

May 2015

$228,700

7.9%

$220,799

4.2%

$209,759 - $231,839

June 2015

$236,400

6.5%

$228,929

3.1%

$222,098 - $245,477

July 2015

$234,000

5.6%

$239,126

7.7%

$227,170 - $251,082

August 2015

$228,700

4.7%

$230,666

5.6%

$219,132 - $242,199

September 2015

$221,900

6.1%

$227,760

8.9%

$216,372 - $239,148

October 2015

TBD

TBD

$225,546

8.7%

$214,269 - $236,824

 

Sources: Google, NAR, Auction.com

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About Auction.com:  

Auction.com, LLC, is the nation’s leading online real estate marketplace. Founded in 2007, the company has sold more than $34 billion in residential and commercial real estate assets. Auction.com has over 900 employees and headquarters in Irvine and Silicon Valley, Calif., as well as offices in key markets nationwide. Visit www.auction.com for more information.

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