The U.S. housing market continues to be a stronghold for the economy as positive data hit the airwaves. The National Association of REALTORS® (NAR) reports that Existing Home Sales in December rose 0.7% to an annual rate of 6.760,000 units, above the 6,500,000 expected. Sales were up 22% from December 2019 while. Sales across the four major U.S. regions were mixed. The NAR also said 31% of total sales were made up of first-time home buyers which were unchanged from December 2019 but down 32% from November 2020.
The downside to the Existing Home Sales report showed that housing inventories plunged 23% year over year, fell 16% monthly and are at an all-time inventory low of 1.9 months. The median home price in December was $309,800, up 12.9% from December 2019. "Home sales rose in December, and for 2020 as a whole, we saw sales perform at their highest levels since 2006, despite the pandemic," said Lawrence Yun, NAR's chief economist. "What's even better is that this momentum is likely to carry into the new year, with more buyers expected to enter the market."
The U.S. financial markets are ending the holiday-shortened week on a quiet note with stock and bond prices unchanged to lower. This week, the closely watched S&P 500 stock index hit a record high close on Thursday of 3,853.07 due in part to positive corporate earnings and hopes of fresh stimulus. Over in the Mortgage-Backed and Treasury security markets, prices recovered from their recent decline while the yield on the 10-year note has fallen from 1.19% to 1.08% in the past seven trading days. Looking ahead to next week, the economic calendar features a broad array of data while the two-day Federal Open Market Committee meeting begins on Tuesday. The Fed's monetary policy statement will be released at 2:00 p.m. ET followed by Fed Chair Powell's press conference at 2:30 p.m. ET.