Existing Home Sales Leap; Industrial Production Revised Downward
Economic Watch: Existing-home sales increased in June to their highest pace in over eight years, according to figures released Wednesday by the National Association of Realtors, while a separate report shows post-recession industrial production levels are not as strong as earlier thought.
Evan Lockridge・Former Business Contributing Editor
July 22, 2015
2 min to read
Existing-home sales increased in June to their highest pace in over eight years, according to figures released Wednesday by the National Association of Realtors, while a separate report shows post-recession industrial production levels are not as strong as earlier thought.
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Total existing-home sales, which include single-family homes, townhomes, condominiums and co-ops, increased 3.2% to a seasonally adjusted annual rate of 5.49 million in June from a downwardly revised 5.32 million level in May.
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Sales are now at their highest pace since February 2007. They have increased year-over-year for nine consecutive months and are 9.6% percent above a year ago, according to the group.
"This wave of demand is being fueled by a year-plus of steady job growth and an improving economy that's giving more households the financial wherewithal and incentive to buy."
Lawrence Yun, NAR chief economist, said backed by June's solid gain in closings, this year's spring buying season has been the strongest since the downturn.
"Buyers have come back in force, leading to the strongest past two months in sales since early 2007," he said. "This wave of demand is being fueled by a year-plus of steady job growth and an improving economy that's giving more households the financial wherewithal and incentive to buy."
The report also shows single-family home sales, the largest share of the market, increased 2.8% to a seasonally adjusted annual rate of 4.84 million in June from 4.71 million in May, and are 9.8% above the pace from a year ago.
Existing condominium and co-op sales rose 6.6% to a seasonally adjusted annual rate of 650,000 units in June, up 8.3% from June 2014.
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Industrial Production
Meantime, on Tuesday the U.S. Federal Reserve issued revised annual industrial production data. These statistics, which measures the total output from the nation’s factories, mines and utilities, now show overall performance falling for the first five months of the year, according to Stifel Fixed Income Economist Lindsey Piegza.
She described the changes as “quite large.”
Production in 2012-2014 was revised down nearly 1 percentage point a year, averaging a 2.8% annual increase compared to a previously reported 3.6% average pace.
According to the Fed, “the lower rates of change for recent years indicate that the recovery in the industrial sector since the trough has been slower than reported earlier. Total industrial production is now estimated to have returned to its pre-recession peak in May 2014, seven months later than previously estimated.”
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