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American home sales reach three-year minimum
In December, American home sales slipped to their lowest value for three years. House price increases speeded down steeply, dropping a hint at a further decrease of momentum in the American housing market.
Tuesday’s dismal report from the National Association of Realtors also suggested that the American economy was speeding down. Eventually, a long shutdown of the American federal government that has postponed a report from the Commerce Department is actually making it harder to obtain a full read of the American economy.
As the NAR informed, existing home sales in the USA dived by 6.4% to a seasonally updated annual rate of up to 4.99 million units in December 2018. It turned out to be the lowest result since November 2015.
Additionally, November's sales tempo was updated a bit up to 5.33 million unit from the previously posted 5.32 million units.
Financial analysts had hoped that existing home sales would decrease by 1% to 5.25 million units in December. Additionally, from last year existing home sales making up almost 90% of American home sales decreased by 10.3%.
For all of the previous year, sales declined by 3.1% hitting 5.34 million units. It turns out to be the weakest reading since 2015.
The US housing market has been hampered by higher mortgage rates, not to mention labor and land shortages that have resulted in tight inventory as well as more expensive houses. Nevertheless, there’s a hope for the sector. For example, the 30-year fixed mortgage rate dived to a four-month minimum, with much of the moderation taking place in the second half of the previous month, while house price inflation is speeding down.
From the previous year the median existing house price tacked on by 2.9% to $253,600 in December. It happened to be the smallest leap since February 2012.
We are now past the middle of January, and this means that the largest US companies will report their earnings for the fourth quarter and many of them will provide the results of the entire 2020.
The US NFP report will come out on January 8 at 15:30 MT time.
The market optimism waned amid stricter restrictions to control rising coronavirus infections. S&P 500 and Nasdaq dropped from the all-time highs, while the USD jumped higher.
S&P 500 skyrocketed to the all-time high on optimism that Biden’s fiscal stimulus will support economic growth and boost corporate earnings.
PMI reports from the EU, the UK, and the USA will be released during the day!