Existing home sales slipped 0.8% in April and previously reported March sales were revised lower. In April, 37% of sales were of distressed properties. All cash sales made up 31% of sales while investors accounted for 20%. First time home buyers were 36% of sales which is a reversal from last year when first time buyers made up 44% of sales (which were boosted by the credit). With a tight mortgage market and sluggish economic recovery, we believe that first time homebuyers will continue to struggle this year and most of next. Total housing inventory increased 9.9% and at the current sales pace, it will take 9.2 months to clear the supply of homes (not accounting for the “shadow inventory”). Last month, the months’ supply was 8.3.
Bank of America Merrill Lynch Morning Market Tidbits May 20, 2011
