US existing home sales dip more than expected in September

U.S. home sales took an 11.5% dive in September to 468,000 units annualized, the largest decline since July 2013 and the lowest level since November 2014. And, there were fewer sales in all regions of the country, particularly in the Northeast where they plunged 61.8%. There were also downward revisions to the prior two months, which added to the sting. Inventories rose for the first time in a few months, but at 225,000 units, are still low. But coupled with the weak sales figure, the months' supply rose to 5.8, the highest in over a year. It is getting pricier as well, to buy a new home,the average price jumped 13.5% from a year ago.

"As disappointing as this is, sales of new homes are a much smaller component as existing 468,000 versus 5.55 mln units. And, this is a choppy series so don't be too taken aback if we see a bounce back in October. But stepping back, know that new home sales have picked up after bottoming at 270,000 in 2011, supported by all of the factors that support housing (affordability, low borrowing costs, job growth). Unfortunately, the momentum slowed as Q3 came to an end", says BMO Economics.