The National Association of Realtors’ released June existing home sales data today.  Economists had been expecting a minor increase but instead a decline was reported, registering the lowest month of the last seven.  The seasonally adjusted annual rate for the nation in June was 4.77 million, a decline of 0.8% from May, and an 8.8% decline from 2010. However, the closing comparison to last June, which was when the tax credits expired, is a tough comparison to make.  Besides the surprise (which wasn’t a surprise to me), the more interesting news was that NAR reported that median existing home prices increased 0.8% year-over-year.  On the pricing front, we’re seeing much more evidence of price stability and improvement in many large and high profile markets even though home closings remain depressed.
 

The Commerce Department released the New Residential Construction data this morning, and the top line results seemed to indicate improvements in new construction.  But beneath the top line were some very important changes occurring in the underlying data indicating that we have a real divergence between single family and multifamily construction in 2011.
 

We couldn’t help but feel a pang of sympathy when BuilderOnline reported the data difficulties being had by the Illinois Association of Realtors.  It can be a challenge when you’re looked to as a source of reliable information and someone makes a mistake.  In the end, with the help a local MLS affiliate, it sounds like they’ll get their pricing data corrected and revised.

Nick Timiraos’ post in The Wall Street Journal ‘s Developments blog posited that the new home buyer tax credit created uncertainty and unpredictability—precisely why  another round of credits should not be considered now

Suffice to say housing data has not been pleasant to look at lately.  But while conditions are still grim, they aren’t as bad as some of the figures would suggest.  Part of the cause of this is the federal tax credit for home purchases in 2010, which temporarily boosted the pace of new home sales in April and May, and thus new home closings in May and June (see our entry from May 2010, Life After the Tax Credit), with June 2010 having an especially large amount.  When many data sources cite housing data, they tend to do some amount of year-over-year comparison due to the highly seasonal nature of the housing market, even those with complex seasonal adjustment programs weight prior year activity in measuring current conditions.  So not surprisingly, it makes things today look markedly worse.  According to data from Housing IntelligencePro, the number of new home closings on a 12 month rolling basis has been sliding in every month so far in 2011.  But with June 2010 falling out of the rolling 12 month equation, June 2011 is set for a decline of nearly 6%, which is double the drop of March, April and May.