CNBC’s Diana Olick summed up today’s April NAR Existing Home Sales report best by saying:
The lesson to take from this report is that all home price changes now are more local and more price-range specific than ever.
Below is the NAR table she references to show the trend, and this underscores a couple points I’ve been making for a few months.
(1) There’s been a growing gap between median Existing and New Home prices: new homes have sold for up to 49% more than existing homes in recent months. This is because high-end new construction sells at a premium since those consumers can afford it. And short sales and foreclosure sales put a drag on existing home prices. Plus higher inventory for existing home sales (4,620,000 annualized) vs. new home sales (328,000 annualized) contributes to the price disparity as well.
(2) All home pricing is local. Here’s how to price a home.
I’ll comment further on new vs. existing home prices when April New Home Sales come out tomorrow. That report includes a median new home prices stat, but the more widely followed home pricing stats will come out next Tuesday when Case Shiller’s March report is released. Stay tuned.
Meantime, Olick’s piece is a must-read. And so is another piece today on seasonality in NAR data by appraiser Jonathan Miller, who did an awesome May 2009-PRESENT chart to make his point.