News & Events

Economic Advisor: April 26, 2017
April 26, 2017


Existing-home sales hit their highest point in a decade, while housing starts unexpectedly fell, and layoffs increased.

Existing-Home Sales

Existing-home sales for March hit their highest pace in over 10 years, with total transactions of existing single-family homes, townhomes, condominiums and co-ops growing 4.4 percent to hit an annual rate of 5.71 million for the month, the National Association of Realtors reported last week. Compared to last year, this was 5.9 percent higher than March 2016, and this marked the highest sales pace since February 2007’s rate of 5.79 million.

“The early returns so far this spring buying season look very promising as a rising number of households dipped their toes into the market and were successfully able to close on a home last month,” NAR Chief Economist Lawrence Yun said. “Although finding available properties to buy continues to be a strenuous task for many buyers, there was enough of a monthly increase in listings in March for sales to muster a strong gain. Sales will go up as long as inventory does.”

Bearing that in mind, the total inventory of existing homes of all types at the end of March grew 5.8 percent to 1.83 million, constituting a 3.8-month supply at March’s sales pace. That said, March’s inventory was 6.6 percent lower than the same period a year ago, marking the 22nd consecutive month of year-over-year declines.

Looking at affordability, the median price for existing homes of all types hit $236,400, which was 6.8 percent over March 2016’s price of $221,400. March’s data marked the 61st straight month of year-over-year price gains.

Housing Starts

Starts on construction of private homes beginning in March dropped to an annual rate of 1.21 million, which was 6.8 percent below February’s rate of 1.30 million, according to last week’s report form the Census Bureau. Starts on single-family homes in March dipped to a rate of 821,000, which was 6.2 percent below February’s rate of 875,000.

March’s starts were below market expectations, which has anticipated a rate of 1.25 million, but when compared annually was 9.2 percent higher than March 2016’s rate of 1.11 million.

Building permits issued for the construction of housing during March grew to an annual rate of 1.26 million, which was 3.6 percent higher than February’s rate of 1.21 million, and a whopping 17 percent over March 2016’s rate of 1.07 million. Permits issued for single-family homes ticked down to an annual rate of 823,000, which was 1.1 percent down from February’s pace of 832,000.

Initial Jobless Claims

First-time claims for unemployment benefits filed by newly laid-off individuals during the week ending April 15 grew to hit 244,000, which was 10,000 over the previous week’s level of 234,000, the Employment and Training Administration reported last week.

This put initial jobless claims at the 111th straight week of claims falling below the 300,000 mark, a level that economists consider indicative of a growing job market.

The four-week moving average — considered to be a more reliable measure of layoffs — dipped to 243,000, a decline of 4,250 claims from the preceding week’s average of 247,250.

This week, we can expect:

  • Tuesday — New home sales for March from the Census Bureau; consumer confidence for April from The Conference Board.
  • Thursday — Durable goods orders for March from the Census Bureau; initial jobless claims for last week from the Employment and Training Administration.
  • Friday — Consumer sentiment for April from the University of Michigan Surveys of Consumers; GDP (advanced) for the First Quarter from the Bureau of Economic Analysis.

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