Latest / Markets with Megan: A Quick Financial Markets Update / Existing Home Sales Update: January’s Surge | Episode 104 | 02-22-2024

Transcript

Existing Home Sales Update: January’s Surge | Episode 104 | 02-22-2024 · Markets with Megan: A Quick Financial Markets Update

• 0:01
  Speaker 0: Hello, this is Megan Horneman, the Chief Investment Officer for Verdence Capital Advisors.
• 0:05
  Speaker 0: We're coming to you today, on Thursday, February 22nd, to discuss the existing home sales report that we got this morning.
• 0:11
  Speaker 0: For the month of January, the home sales came out a little bit better than expected.
• 0:16
  Speaker 0: We did cross back up to that psychological level of 4 million home sales on an annualized rate.
• 0:23
  Speaker 0: It was the biggest jump we've seen since February of 2023.
• 0:27
  Speaker 0: It was led by single-family homes, but all of the regions saw increases.
• 0:33
  Speaker 0: The only region that was flat for the month was the northeast.
• 0:37
  Speaker 0: Actually, the west saw the biggest gains for the month.
• 0:41
  Speaker 0: Some of the negative news I guess you could say out of this report is unfortunately, there are still headwinds for the housing market because in the beginning of this year the mortgage rate was below 7 percent.
• 0:53
  Speaker 0: We saw some of the things like prospective buyers' traffic increase because we got that dip lower in mortgage rates.
• 1:00
  Speaker 0: But unfortunately now in February, mortgage rates are back up above 7 percent, so I'm not sure how sustainable this will be in the coming months.
• 1:08
  Speaker 0: Inventories as well are still very low.
• 1:11
  Speaker 0: The month supply dropped again.
• 1:14
  Speaker 0: It's the third consecutive month we've seen a drop in the month supply, the home prices.
• 1:19
  Speaker 0: The median price of an existing home is still elevated.
• 1:22
  Speaker 0: That means that affordability, not only for first-time home buyers but really for all home buyers, is still a challenge.
• 1:29
  Speaker 0: The median home price now is 379,000 versus the five-year average of 325,000.
• 1:38
  Speaker 0: So the housing market is trying its best to find a footing here.
• 1:41
  Speaker 0: We do think that this is a cycle.
• 1:44
  Speaker 0: It will take time to work itself out.
• 1:46
  Speaker 0: It's usually the first thing to drop when interest rates do start to tick up, and the bigger problem we have right now is that prices are still elevated.
• 1:54
  Speaker 0: Inventories are low, so affordability is very low for Americans to buy a first-time home.
• 2:01
  Speaker 0: That's all we have today, and I'll be back next week with a pretty packed economic calendar.
• 2:07
  Speaker 0: But if you have any questions or comments, please feel free to reach out to podcast at Verdence dot com.
• 2:12
  Speaker 0: Thank you.