January Existing Home Sales Will Level Off After December's Artificially Inflated Numbers

IRVINE, Calif. and SILICON VALLEY, Calif., Feb. 2, 2016 /PRNewswire/ -- Ten-X (formerly Auction.com), the nation's leading online real estate marketplace, has released its recently rebranded Ten-X Residential Real Estate Nowcast which projects that existing home sales for January will fall between seasonally adjusted annual rates of 5.13 and 5.46 million annual sales, with a targeted number of 5.29 million – up a healthy 9.8 percent from a year ago, but down 3 percent from the previous month.

"On a year-over-year basis, it looks like January will get 2016 off to a good start," said Ten-X Executive Vice President Rick Sharga. "It's apparent now that November sales figures were artificially low due to delays associated with the new TRID processes, and December numbers were artificially inflated as lenders quickly worked through the backlog. What we're seeing online suggests that home buyers are slightly more active than they were last year at this time, which is a good sign for the housing market."

Last week, the National Association of Realtors® (NAR®) released its existing home sales data for December, reporting a 14.7 percent month-over-month increase in home sales to 5.46 million units, following a substantial drop in November. Ten-X Chief Economist Peter Muoio predicted that a bounce back would occur by early 2016, but the correction appears to have happened even more quickly than anticipated, causing another volatile swing in existing home sales numbers.

"Putting the sudden drop and bounce aside, existing home sales in November and December averaged a 5.11 million rate – close to the 5.26 SAAR average pace that persisted across 2015," noted Muoio. "This supports our view that several positive underlying fundamentals – a healthy job market, wage gains, improved consumer confidence and low interest rates – have supported the housing market recovery and should lead to increased sales moving into 2016."

Home prices remain strong. NAR recently reported a 7.6 percent year-over-year increase in median existing home prices in December to $224,100 – well within the range of $212,156 - $234,488 that Ten-X predicted last month. Findings from the Ten-X Real Estate Nowcast suggest that sales prices for existing homes will fall between $216,839 and $239,664 in the month of January with a targeted price of $228,251, representing a 15.5 percent year-over-year increase.

"The lack of inventory, and the mix of properties being sold - largely in the mid-to-upper price range in most markets - continues to drive home prices up," Sharga noted. "At some point this may become a problem from an affordability standpoint, especially if interest rates go up as well."

About the Ten-X Residential Real Estate Nowcast Model

The Ten-X Residential Real Estate Nowcast combines industry data, proprietary company transactional data and Google search activity to predict market trends as they are occurring – weeks before the findings of other benchmark studies are released. Building upon the groundbreaking work by Google Chief Economist Hal Varian, Ten-X's nowcast model extends a traditional autoregressive-forecasting model to incorporate contemporaneous information that provides significantly enhanced accuracy.

Ten-X will occasionally update its nowcast as fresh data provides additional signals for current home sales activity. The Ten-X Residential Real Estate Nowcast model has been highly accurate over the past year.

Existing Home Sales

Sources: Google, NAR, Ten-X

Existing Home Sales Pricing

Sources: Google, NAR, Ten-X

About Ten-X

Ten-X (formerly Auction.com) is the nation's leading online real estate marketplace, having sold 200,000+ residential and commercial properties totaling more than $37 billion since 2007. Leveraging desktop and mobile technology, Ten-X allows people to safely and easily complete real estate transactions entirely online.

Ten-X empowers consumers, investors and real estate professionals with unprecedented levels of flexibility, control and simplicity – and the convenience of buying and selling properties whenever they want and from wherever they are. As real estate continues to move online, Ten-X is uniquely positioned to be at the forefront of this dramatic behavioral shift.

Ten-X is headquartered in Irvine and Silicon Valley, Calif., and has offices in key markets nationwide. Investors in the company include Google Capital and Stone Point Capital. For more information, visit Ten-X.com.

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SOURCE Ten-X

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