U.S. existing home sales likely to have risen slightly in October, overall sales likely to remain weak in months ahead

U.S. existing home sales data for the month of October is set to be released tomorrow. According to a Wells Fargo research report, existing home sales are likely to have risen slightly in the month. The continued deceleration in existing sales has not been entirely surprising. Pending home sales, mortgage purchase applications and the proportion of consumers stating now is a good time to purchase a home have all been trending lower in recent months.

Inventories are another dynamic that had been trending lower for over three years. With fewer homes for sale, existing home sales are expected to fall. The decline in home buying has coincided with increasing mortgage rates and follows years of rapid price appreciation, which have collectively taken a toll on affordability. Housing market is expected to continue to ease in months ahead, as virtually every leading indicator of housing has continued to soften.

“While we expect to see less typical seasonal weakness over the winter months, we expect the overall sales to remain anaemic”, added Wells Fargo.

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