The Line: Existing Home Sales Down 1.9% in April

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Gregory Heym is Chief Economist at Brown Harris Stevens. His weekly series, The Line, covers new developments to the economy, including trends and forecasts. Read on for the latest report and subscribe here to receive The Line in your inbox.

Today, we have the latest on existing home sales, try to figure out why more than half of Americans surveyed think we're in a recession, and thank those who gave their life in defense of this country.

Existing Home Sales Down 1.9% in April

The increase in mortgage rates at the start of 2024 continues to slow the housing market, with existing home sales falling for the second straight month in April. Here are the highlights of the report:

  • Existing homes sales fell 1.9% in April and were also 1.9% lower than a year ago.

  • The median sales price rose 5.7% over the past year to $407,600, which is a record price for the month of April.

  • Inventory increased by 9% last month to a 3.5-month supply. Inventory is up 16.3% from a year ago.

  • The high-end of the market—homes priced at $1 million or more—was particularly strong in April, as a 34% increase in inventory over the past year led to a 40% jump in sales compared to April 2023.

  • All-cash sales accounted for 28% of transactions in April, unchanged from March.

To sum up, despite a noticeable increase in inventory, existing home sales continue to decline due to rising prices and higher rates. Hopefully inventory will continue to rise in the coming months, forcing prices lower and mitigating the damage from persistently high mortgage rates.

56% of Americans Think That U.S. is in a Recession

A new Guardian/Harris poll found that almost three in five respondents wrongly believe the U.S. economy in recession. Some other scary findings of the survey:

  • 49% believe the S&P 500 is down this year, while in fact it’s up over 12%.

  • 49% believe that unemployment is at a 50-year high, even though it’s actually near a 50-year low.

Why do they have it so wrong? Outside of the fact that most aren’t reading this column, I would point the finger at the worst inflation in four decades. Americans have struggled the past two and a half years to keep up with the surge in prices, running up record levels of credit card debt in the process. When you have to go into debt to buy groceries, I don’t know how you couldn’t have a negative view of the economy. Some of this could also be attributed to politics, as the Republicans surveyed tended to more negative on the economy than Democrats.

A Thanks to Those Who Gave the Ultimate Sacrifice

Just wanted to take a moment to think about the men and women who died in service to this great nation as we approach Memorial Day. Your sacrifice is the reason our country has remained safe and free, and we can never repay that debt. God bless you and your families.

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