AllMarket Outlook
logoArgusJune 16, 2021

Daily Spotlight: Home Prices Hot, Other Stats Cool

Market Outlook
Bullish - Short term

The U.S. housing market has been a positive contributor to the economic recovery, though some statistics have dropped from recent highs. The National Association of Realtors reported that existing home sales fell in April to a 5.85 million seasonally adjusted annual rate -- still well above the 3.9 million rate in May 2020. The Commerce Department reported that new home sales, which were down 33% in April 2020 from January 2020, recovered to 10-year-high levels of more than 1 million sales per year last August and remained elevated at an 863,000 rate in April. As well, building permits were up 70% in April 2021 compared to April 2020, according to the Census Bureau. Though most of these indicators have cooled, housing prices have not. The S&P/Case-Shiller National Home Price Index for March 2021 showed that prices gained 13.2% year-over-year, the highest gain in 15 years. Meanwhile, inventory levels are tight, according to the U.S. Census Bureau. On the other side of the pandemic, we think demand for homes, with yards between neighbors and plenty of space, will remain solid, supporting economic growth.

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