US: Existing home sales rebounded solidly in June – Wells Fargo

Existing home sales in the US rebounded 20.7% in June, slightly below market consensus. The rebound follows a sustained rise in mortgage applications fueled by lower mortgage rates, explained analysts at Wells Fargo. 

Key Quotes: 

“The National Association of Realtors (NAR) reported that overall existing home sales rose 20.7% to a 4.72 million-unit pace. Sales of single-family homes rose 19.9% to a 4.28 million-unit pace, while sales of condominiums and co-ops rose 29.4% to a 440,000 unit pace. Both, however, remain well below their February pace. Home sales had gotten off to a great start this year, with solid job growth, lower interest rates and mild winter weather bringing buyers into the market earlier than usual.”

“Sales fell abruptly when shutdowns were implemented to stop the spread of the virus from overwhelming the hospital system earlier this year, and in-person showings of home were largely forbidden.”

“Buyer interest was certainly there during the shutdown. Online sales platforms reported increased inquiries. Weekly mortgage purchase applications began to rebound in late April and have continued to ramp up into the summer, even as some other high-frequency measures have cooled off. The only glitch is the continued lack of homes available for sale.”

“With more people spending time at home, homeowners and renters are looking for more space, which should bring more sellers and buyers to the market in coming months.”