Existing Home Sales USA Sep-2009

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Wells Fargo recently quantified the national housing market. A great peek at what might be happening moving forward. Don\'t let this market pass you by - DKYS!

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Existing Home Sales USA Sep-2009

  1. 1. October 23, 2009 Economics Group Adam G. York, Economist adam.york@wachovia.com ● 704.715.9660 Existing Home Sales Bounced Sharply Higher in September Existing home sales jumped 9.4 percent in September to an annual pace of 5.57M units, the best performance since summer 2007. Buyers and sellers continued to take advantage of the first-time home buyer tax credit. Sales Moved Sharply Higher First-Time Homebuyer Tax Credit Still the Key • Sales jumped 9.4 percent, the biggest jump since the combined • Buyers are likely rushing to complete transactions ahead of the single- and multi-family series began in 1999. Single- and looming tax credit expiration. We would expect higher sales multi-family properties both saw increases of more than levels to persist through October and into November before 9 percent. The longer-running single-family series saw its collapsing in December if the credit is not extended. biggest monthly increase since 1983. • Average and median sales prices remain under pressure as • Inventory levels have improved, but are still a long way from buyers with access to the tax credit tend to purchase lower-end “normal,” and equilibrium may be years away. homes, which are dominating the marketplace at this point. Existing Home Resales Existing Single-Family Home Resales Seasonally Adjusted Annual Rate - In Millions Seasonally Adjusted Annual Rate - In Millions 7.5 7.5 7.0 7.0 7.0 7.0 6.0 6.0 6.5 6.5 5.0 5.0 6.0 6.0 5.5 5.5 4.0 4.0 5.0 5.0 3.0 3.0 4.5 4.5 Existing Home Sales: Sep @ 5.57 Million Existing Home Sales: Sep @ 4.9 Million 4.0 4.0 2.0 2.0 1999 2001 2003 2005 2007 2009 86 88 90 92 94 96 98 00 02 04 06 08 Inventory of Existing Homes for Sale Median Single-Family Existing Home Price Existing Homes for Sale at End of Month, In Thousands Year-over-Year Percentage Change 5,000 5,000 20% 20% 16% 16% 4,500 4,500 12% 12% 4,000 4,000 8% 8% 4% 4% 3,500 3,500 0% 0% 3,000 3,000 -4% -4% -8% -8% 2,500 2,500 -12% -12% Median Price Change: Sep @ -8.1% 2,000 2,000 6-Month Moving Average: Sep @ -13.4% -16% -16% Total Inventory: Sep @ 3,630 Median Sale Price: Sep @ $174,900 1,500 1,500 -20% -20% 1999 2001 2003 2005 2007 2009 97 99 01 03 05 07 09 Source: National Association of Realtors and Wells Fargo Securities, LLC
  2. 2. Wells Fargo Securities, LLC Economics Group Diane Schumaker-Krieg Global Head of Research (704) 715-8437 diane.schumaker@wachovia.com & Economics (212) 214-5070 John E. Silvia, Ph.D. Chief Economist (704) 374-7034 john.silvia@wachovia.com Mark Vitner Senior Economist (704) 383-5635 mark.vitner@wachovia.com Jay Bryson, Ph.D. Global Economist (704) 383-3518 jay.bryson@wachovia.com Scott Anderson, Ph.D. Senior Economist (612) 667-9281 scott.a.anderson@wellsfargo.com Eugenio Aleman, Ph.D. Senior Economist (612) 667- 0168 eugenio.j.aleman@wellsfargo.com Sam Bullard Economist (704) 383-7372 sam.bullard@wachovia.com Anika Khan Economist (704) 715-0575 anika.khan@wachovia.com Azhar Iqbal Econometrician (704) 383-6805 azhar.iqbal@wachovia.com Adam G. York Economist (704) 715-9660 adam.york@wachovia.com Ed Kashmarek Economist (612) 667-0479 ed.kashmarek@wellsfargo.com Tim Quinlan Economic Analyst (704) 374-4407 tim.quinlan@wachovia.com Kim Whelan Economic Analyst (704) 715-8457 kim.whelan@wachovia.com Yasmine Kamaruddin Economic Analyst (704) 374-2992 yasmine.kamaruddin@wachovia.com Wells Fargo Securities Economics Group publications are produced by Wells Fargo Securities, LLC, a U.S broker-dealer registered with the U.S. Securities and Exchange Commission, the Financial Industry Regulatory Authority, and the Securities Investor Protection Corp. Wells Fargo Securities, LLC, distributes these publications directly and through subsidiaries including, but not limited to, Wells Fargo & Company, Wachovia Bank N.A., Wells Fargo Bank N.A, Wells Fargo Advisors, LLC, and Wells Fargo Securities International Limited. The information and opinions herein are for general information use only. Wells Fargo Securities, LLC does not guarantee their accuracy or completeness, nor does Wells Fargo Securities, LLC assume any liability for any loss that may result from the reliance by any person upon any such information or opinions. Such information and opinions are subject to change without notice, are for general information only and are not intended as an offer or solicitation with respect to the purchase or sales of any security or as personalized investment advice. Wells Fargo Securities, LLC is a separate legal entity and distinct from affiliated banks and is a wholly owned subsidiary of Wells Fargo & Company © 2009 Wells Fargo Securities, LLC. SECURITIES: NOT FDIC-INSURED/NOT BANK-GUARANTEED/MAY LOSE VALUE

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