September’s jobs report; August’s trade deficit, construction spending, factory orders, and wholesale sales; October’s existing home sales

Major agency reports released this past week included the Employment Situation Summary for September from the Bureau of Labor Statistics, the August report on our International Trade from the Commerce Dept, and the August report on Construction Spending (pdf), the Full Report on Manufacturers’ Shipments, Inventories and Orders for August, and the September report on Wholesale Trade, Sales and Inventories, all from the Census Bureau from the Census Bureau…in addition, this week also saw the regularly scheduled Existing Home Sales Report for October from the National Association of Realtors (NAR), and the first three regional Fed manufacturing surveys for November: the Empire State Manufacturing Survey from the New York Fed, which covers all of New York state, a suburban NYC county in Connecticut, Puerto Rico and northern New Jersey, reported their headline general business conditions index rose from +10.7 in October to +18.7 in November, its fourth increase in five months, meaning that a significant majority of Second District manufacturers are now reporting improving conditions, after a large plurality reported improving business conditions last month; the Philadelphia Fed Manufacturing Survey, covering most of Pennsylvania, southern New Jersey, and Delaware, reported its broadest diffusion index of manufacturing conditions rose from a reading of -12.8 in October to -1.7 in November, which means that a small plurality of manufacturers continued to report deteriorating conditions this month, and the Kansas City Fed manufacturing survey, covering western Missouri, Colorado, Kansas, Nebraska, Oklahoma, Wyoming and northern New Mexico, who reported their broadest composite index came in at +8 in November, up from +6 in October and from +4 in September, which means that a larger plurality of Tenth District manufacturers are reporting improving conditions this month, compared to the prior two…

Employers Added 119,000 Jobs in September; Unemployment Rate Rose to a 47 Month High

The Employment Situation Summary for September reported the largest increase in payroll jobs since April, nearly triple what had been expected, and that the unemployment rate, the employment rate, and labor force participation rate all rose…estimates extrapolated from the establishment survey data projected that employers added a seasonally adjusted 119,000 jobs in September, after the previously estimated payroll job increase for July was revised from last month’s revised figure of 79,000 down to 72,000, while the payroll jobs change for August was revised from an increase of 22,000 jobs to a decrease of 4,000, revisions which mean that this report thus shows 86,000 more payroll jobs than were reported for August, double the 43,000 job increase that was expected…. the unadjusted data, meanwhile, shows that there were actually 317,000 more payroll jobs in September, largely due to job increases relating to the beginning of the school year, and that the seasonal adjustment brought the headline jobs number down to a level where that normal September school jobs increase was negated…

Seasonally adjusted job increases were spread throughout goods producing, the service sector and in branches of state and local government, while job losses of 25,300 in transportation and warehousing and 17,800 in employment services were due to seasonal adjustment.…since the BLS summary of the job gains by sector is clear and as detailed as our usual synopsis, we’ll just quote from that summary here:

• Total nonfarm payroll employment edged up by 119,000 in September but has shown little change since April. In September, employment continued to trend up in health care, food services and drinking places, and social assistance. Job losses occurred in transportation and warehousing and in federal government. (See table B-1.)
• In September, health care added 43,000 jobs, about the same as the average monthly gain of 42,000 over the prior 12 months. Over the month, employment gains occurred in ambulatory health care services (+23,000) and hospitals (+16,000).
• Employment in food services and drinking places continued to trend up in September (+37,000).
• In September, social assistance employment continued to trend up (+14,000), reflecting continued job growth in individual and family services (+20,000).
• Employment in transportation and warehousing declined by 25,000 in September as job losses occurred in warehousing and storage (-11,000) and couriers and messengers (-7,000).
• Federal government employment continued to decline in September (-3,000) and is down by 97,000 since reaching a peak in January. (Employees on paid leave or receiving ongoing severance pay are counted as employed in the establishment survey.)
• Employment showed little or no change over the month in other major industries, including mining, quarrying, and oil and gas extraction; construction; manufacturing; wholesale trade; retail trade; information; financial activities; professional and business services; and other services.

The establishment survey also showed that average hourly pay for all employees rose by 9 cents an hour to $36.67 an hour in September, after it had increased by a revised 15 cents an hour in August; at the same time, the average hourly earnings of production and nonsupervisory employees increased by 8 cents to $31.53 an hour….employers also reported that the average workweek for all private payroll employees was unchanged at 34.2 hours in September, while hours for production and non-supervisory personnel increased by 0.1 hour to 33.7 hours…at the same time, the manufacturing workweek decreased by 0.1 hour to 39.9 hours, while average factory overtime was unchanged at 2.9 hours…

Meanwhile, the seasonally adjusted extrapolation from the September household survey indicated that the number of those who would self-report being employed rose by an estimated 251,000 to 163,645,000, while the similarly estimated number of those who would qualify as being unemployed rose by 219,000 to 7,603,000; and hence the civilian labor force increased by a rounded 470,000…since the working age population had grown by 225,000 over the same period, that meant the number of employment aged individuals who were not in the labor force fell by a rounded net of 245,000 to 102,978,000, which combined with the higher labor force, meant that the labor force participation rate rose from 62.3% in August to 62.4% in September…in addition, the relatively large increase in number employed was enough to boost the employment to population ratio, which we could think of as an employment rate, from 59.6% in August to 59.7% in September….likewise, with the relatively large increase in the number unemployed, the unemployment rate rose from 4.3% to 4.4%, the highest unemployment rate since October 2021….however, the number of the employed who reported they were forced to accept just part time work fell by 170,000 to 4,579,000 in September, which meant that the alternative measure of unemployment, U-6, which includes those “employed part time for economic reasons”, fell from a forty-seven month high of 8.1% of the labor force in August to 8.0% in September, but was still up from 7.7% in September of last year….

Like most reports from the Bureau of Labor Statistics, the employment situation press release itself is easy to read and understand, so you can get more details on these two reports from there…note that almost every paragraph in that release points to one or more of the tables that are linked to on the bottom of the release, and those tables are also on a separate html page here that you can open it alongside of the press release to avoid the need to scroll up and down the page..

US Trade Deficit Fell 23.8% in August, Reversing July Jump, Still Subtracts from Q3 GDP

Our trade deficit fell by 23.8% in August, as the value of our exports increased while the value of our imports decreased….the Commerce Dept report on our international trade in goods and services for August indicated that our seasonally adjusted goods and services trade deficit fell by a rounded $18.6 billion to $59.6 billion in August, from a July deficit of $78.2 billion, which was revised from the $78.3 billion deficit that had been reported for July in September…after rounding, the value of our August exports rose by $0.2 billion to $280.8 billion as a $0.5 billion decrease to $179.0 billion in our exports of goods was more than offset by a $0.8 billion increase to $101.8 billion in our exports of services, while the value of our imports fell by $18.4 billion to $340.4 billion as an $18.6 billion decrease to $264.6 billion in our imports of goods was slightly offset by a $0.3 billion increase to $75.8 billion in our imports of services…prices for our exports were on average 0.3% higher in August, which means our exports rose due to higher prices and that our real exports likely fell by about 0.2%, while import prices were also 0.3% higher, meaning that the value of our imports fell despite higher prices and that our real imports actually fell about 5.4%…

The $0.5 billion decrease in the nominal value of our August exports of goods was due to lower exports of consumer goods, industrial supplies and materials, and of automotive products, which were largely offset by higher exports of capital goods….referencing the Full Release and Tables for August (pdf), in Exhibit 7 we find that our exports of consumer goods fell by $1,546 million to $21,189 million on an $1,219 million decrease in our exports of pharmaceuticals, and that our exports of industrial supplies and materials fell by $589 million to $59,591 million due to a $1,078 million decrease in our exports of non-monetary gold, and that our exports of automotive vehicles, parts, and engines fell by $391 million to $12,669 million, while our exports of other goods not categorized by end use fell by $256 million to $8,501 million…substantially offsetting the decreases in those end-use categories, our exports of capital goods rose by $2.381 million to $62,372 million as a $2,283 million increase in our exports of computers, a $662 million increase in our exports of civilian aircraft, a $578 million increase in our exports of civilian aircraft engines, and a $431 million increase in our exports of semiconductors were partly offset by a $634 million decrease in our exports of computer accessories and a $634 million decrease in our exports industrial machinery not otherwise listed, and our exports of foods, feeds and beverages rose by $68 million to $13,839 million due to a $208 million increase in our exports of corn..

Exhibit 8 in the Full Release and Tables gives us seasonally adjusted details on our imports of goods and shows that lower imports of industrial supplies and materials, consumer goods, capital goods, and foods and beverages were responsible for the $18.6 billion decrease in our imports of goods….our imports of industrial supplies and materials fell by $11,318 million to $49,572 million as a $9,282 million decrease in our imports of nonmonetary gold, a $1,160 million decrease in our imports of copper, a $472 million decrease in our imports of precious metals other than gold, and a $421 million decrease in our imports of finished metal shapes were partly offset by a $1,036 million increase in our imports of crude oil, while our imports of consumer goods fell by $3,711 million to $55,134 million on a $826 million decrease in our imports of jewelry, a $739 million decrease in our imports of pharmaceuticals, a $518 million decrease in our imports of toys, games, and sporting goods, and a $421million increase in our imports of cellphones and similar household goods…in addition, our imports of capital goods fell by $3,402 million to $92,787 million as a $1,286 million decrease in our imports of computer accessories, a $1,101 million decrease in our imports of telecommunications equipment, a $415 million decrease in our imports of medical equipment, a $409 million decrease in our imports of semiconductors, a $406 million decrease in our imports of materials handling equipment, a $352 million decrease in our imports of electric apparatuses and a $343 million decrease in our imports of industrial machinery were partly offset by a $2,276 million increase in our imports of computers, while our imports of automotive vehicles, parts and engines fell by $603 million to $34,517 million on a $394 million decrease in our imports of trucks, buses, and special purpose vehicles…meanwhile, our imports of foods, feeds, and beverages fell by $446 million to $16,905 million on lower imports of fish and shellfish, fruits and juices, wine, beer, and related beverages, and other food, while our imports of other goods not categorized by end use rose by $746 million to $13,590 million….

The press release for this month’s report summarizes Exhibit 19 in the full release, which gives us surplus and deficit details on our goods trade with selected countries:

The August figures show surpluses, in billions of dollars, with Netherlands ($5.1), South and Central America ($4.9), Hong Kong ($1.7), Australia ($1.6), Brazil ($1.2), Singapore ($0.9), United Kingdom ($0.8), Belgium ($0.5), and Saudi Arabia ($0.3). Deficits were recorded, in billions of dollars, with Mexico ($16.3), China ($15.4), Vietnam ($14.4), Taiwan ($12.2), European Union ($8.1), Japan ($5.7), South Korea ($5.0), India ($4.8), Germany ($4.6), Canada ($3.0), Ireland ($3.0), Malaysia ($1.8), Italy ($1.6), France ($1.2), Israel ($0.4), and Switzerland ($0.1).

• The deficit with Switzerland decreased $7.6 billion to $0.1 billion in August. Exports increased $0.8 billion to $3.7 billion and imports decreased $6.8 billion to $3.8 billion.
• The deficit with Canada decreased $2.4 billion to $3.0 billion in August. Exports increased $0.7 billion to $26.8 billion and imports decreased $1.7 billion to $29.7 billion.
• The surplus with the United Kingdom decreased $0.9 billion to $0.8 billion in August. Exports decreased $0.8 billion to $6.5 billion and imports increased $0.1 billion to $5.6 billion.

To gauge the impact of July and August goods trade on 3rd quarter GDP growth figures, we use exhibit 10 in the full pdf for this report, which gives us monthly goods trade figures by end use category and in total, already adjusted in chained 2017 dollars, the same inflation adjustment used by the BEA to compute the impact of foreign trade on GDP, except that the figures are not annualized here….from that table, we can compute that 2nd quarter real exports of goods averaged 150,330.3 million monthly in 2017 dollars, while the similarly inflation adjusted July and August goods export figures were at 146,056 million and 145,451 million respectively, in that same 2017 dollar quantity index representation…computing the annual rate of change between the second and third quarter inflation adjusted averages, we find that the 3rd quarter’s real exports of goods are running at an 11.63% annual rate below those of the 2nd quarter, or at a pace that would subtract about 0.82 percentage points from 3rd quarter GDP if it were continued through September….in a similar manner, we find that our 2nd quarter real imports of goods averaged 237,774.3 million monthly in chained 2017 dollars, while inflation adjusted July and August imports were at 241,892 million and 229,109 million in 2017 dollars respectively…that would mean that so far in the 3rd quarter, our real imports have risen at a 0.29% annual rate from those of the 2nd quarter…since imports subtract from GDP because they represent the portion of consumption or investment that occurred during the quarter that was not produced domestically, their increase at a 0.29% rate would subtract about 0.04 percentage points from 3rd quarter GDP…..hence, if our real trade in goods remains at the same levels as in July and August throughout September, our deteriorating balance of trade in goods over that of the 2nd quarter would subtract about 0.78 percentage points from the growth of 3rd quarter GDP….

However, you might note that we have not computed the impact of the usually less volatile change in services here, because the BEA does not provide inflation adjusted data on those, and we don’t have a straightforward way to adjust the various services for all their price changes, but that our exports in services rose by $0.7 billion in August, whereas our imports in services grew $0.3 billion, partially ameliorating the $1.1 billion imbalance in July’s trade in services, but which would still suggest that the services side of the trade ledger would have a small negative impact on 3rd quarter GDP…

Construction Spending Rose 0.2% in August, has negligible impact on 3rd Quarter GDP

The August report on construction spending (pdf) from the Census Bureau estimated that our seasonally adjusted construction spending for the month was at an annual rate of $2,169.5 billion, which was 0.2 percent (±0.7 percent)* above the revised annualized estimate of $2,165.0 billion in construction spending in July, but was 1.6 percent (±1.5 percent) below the estimated annualized level of construction spending of August of last year….for the first eight months of this year, construction spending amounted to $1,438.0 billion, which was 1.8 percent (±1.0 percent) less than the $1,463.7 billion spent over the same period in 2024…

July’s construction spending was originally reported at a $2,139.1 billion annual rate, so it has been revised more than 1.2% higher, to a $2,165.0 billion annual rate, while June’s construction spending was revised more than 0.9% higher, from the $2,140.5 billion annual rate reported in early September to a $2,160.75 billion rate now…that $20.2 billion upward June revision would mean that 2nd quarter GDP was underestimated by about 0.15 percentage points, give or take, depending on the inflation adjustments for the components revised…..however, the 2nd quarter’s GDP will not be revised to reflect that underestimation until the annual revision of next summer…

A further breakdown of the different subsets of construction spending is provided in a Census summary, which precedes the detailed spreadsheets:

• Private Construction: Spending on private construction was at a seasonally adjusted annual rate of $1,652.1 billion, 0.3 percent (±0.5 percent)* above the revised July estimate of $1,647.5 billion. Residential construction was at a seasonally adjusted annual rate of $914.8 billion in August, 0.8 percent (±1.3 percent)* above the revised July estimate of $907.7 billion. Nonresidential construction was at a seasonally adjusted annual rate of $737.3 billion in August, 0.3 percent (±0.5 percent)* below the revised July estimate of $739.8 billion.
• Public Construction: In August, the estimated seasonally adjusted annual rate of public construction spending was $517.3 billion, virtually unchanged from (±1.2 percent)* the revised July estimate of $517.5 billion. Educational construction was at a seasonally adjusted annual rate of $112.6 billion, 0.6 percent (±2.0 percent)* above the revised July estimate of $111.9 billion. Highway construction was at a seasonally adjusted annual rate of $142.5 billion, 0.2 percent (±2.5 percent)* below the revised July estimate of $142.9 billion.

This construction spending report is used as source data for 3 subcomponents of GDP; investment in private non-residential structures, investment in residential structures, and government investment outlays, for both state and local and Federal governments…. however, gauging the impact of revised July and August construction spending as reported here on 3rd quarter GDP is difficult because all figures given in this report are in nominal dollars at an annual rate, and as you know, data used to compute the change in GDP must be adjusted for changes in price…accurately adjusting construction spending for price changes is not easy either, because the National Income and Product Accounts Handbook, Chapter 6 (pdf), lists a multitude of privately published deflators that are used by the BEA for the various components of non-residential investment, such as the Engineering News Record construction cost index for utilities’ construction spending….so in lieu of trying to find and adjust for all of those obscure price indices, we’ve opted to just use the producer price index for final demand construction as an inexact shortcut to make the price adjustment needed in order to make a ballpark estimate.

That producer price index showed that aggregate construction costs were 0.1% lower in August, after rising 0.6% in July, rising 0.1% in June and rising 0.2% from April to May…on that basis, we can estimate that construction costs for August were roughly 0.5% more than those of June, roughly 0.6% more than those of May, and roughly 0.8% more than those of April, while obviously 0.1% less than those of July…we then use those percentages to inflate the lower cost spending figures for each of the 2nd quarter months, which, for comparison purposes, is arithmetically the same as adjusting higher cost July & August construction spending downward…annualized construction spending in millions of dollars for the second quarter months is shown at $2,160,743 for June, $2,149,124 for May, and $2,153,440 for April in this report, while it was at $2,165,016 million for July and $2,169,468 million for August….thus to compare July and August’s inflation adjusted construction spending to that of the second quarter, our formula becomes: ((2,169,468 + 2,165,016 * .999 ) / 2 ) / (( 2,160,743 * 1.005 + 2,149,124 * 1.006 + 2,153,440 * 1.008) / 3) = 0.999115268, meaning real construction over July and August averaged less than 0.09% lower than that of the 2nd quarter….hence, that means that after crudely adjusting for inflation, we can estimate that real construction for the 3rd quarter fell at 0.35% annual rate from that of the 2nd quarter….put another way, that’s a decrease at a $1, 918 billion annual rate, which means that if September should show no improvement, the decrease in real construction would subtract a net of about 0.03 percentage points from 3rd quarter GDP across those components that it is source data for…

Factory Shipments Fell 0.1% in August, Factory Inventories were Virtually Unchanged

The August Full Report on Manufacturers’ Shipments, Inventories, & Orders (pdf) from the Census Bureau reported that the seasonally adjusted value of new orders for manufactured goods rose by $8.4 billion or 1.4 percent to $612.0 billion in August, following a decrease of 1.3% to $603.6 billion in July, which was revised but statistically unchanged from the previous report….however, since the Census Bureau does not even collect data on new orders for non durable goods for this widely watched “factory orders report”, and only estimates them based on factory shipments, both the “new orders” and “unfilled orders” sections of this report are really only accurate as revised updates to the August advance report on durable goods that we reported on in September…on those revisions, the Census Bureau’s own summary, which precedes their detailed spreadsheet of the metrics included in this report, is quite complete, so we’ll just quote directly from that summary here:

• Summary New orders for manufactured goods in August, up following two consecutive monthly decreases, increased $8.4 billion or 1.4 percent to $612.0 billion, the U.S. Census Bureau reported today. This followed a 1.3 percent July decrease. Shipments, down following three consecutive monthly increases, decreased $0.8 billion or 0.1 percent to $607.7 billion. This followed a 0.9 percent July increase. Unfilled orders, up thirteen of the last fourteen months, increased $9.4 billion or 0.6 percent to $1,478.7 billion. This followed a virtually unchanged July increase. The unfilled orders-to-shipments ratio was 6.93, up from 6.86 in July. Inventories, up ten of the last eleven months, increased $0.2 billion or virtually unchanged to $948.4 billion. This followed a 0.2 percent July increase. The inventories-to-shipments ratio was 1.56, unchanged from July.
• New Orders for manufactured durable goods in August, up following two consecutive monthly decreases, increased $8.7 billion or 2.9 percent to $311.8 billion, unchanged from the previously published increase. This followed a 2.8 percent July decrease. Transportation equipment, also up following two consecutive monthly decreases, led the increase, $8.1 billion or 7.9 percent to $110.2 billion. New orders for manufactured nondurable goods decreased $0.3 billion or 0.1 percent to $300.3 billion.
• Shipments of manufactured durable goods in August, down following eight consecutive monthly increases, decreased $0.6 billion or 0.2 percent to $307.4 billion, unchanged from the previously published decrease. This followed a 1.5 percent July increase. Transportation equipment, down following four consecutive monthly increases, led the decrease, $0.2 billion or 0.2 percent to $102.1 billion. Shipments of manufactured nondurable goods, down following three consecutive monthly increases, decreased $0.3 billion or 0.1 percent to $300.3 billion. This followed a 0.3 percent July increase. Petroleum and coal products, down following two consecutive monthly increases, drove the decrease, $0.6 billion or 1.1 percent to $54.7 billion.
• Unfilled Orders for manufactured durable goods in August, up thirteen of the last fourteen months, increased $9.4 billion or 0.6 percent to $1,478.7 billion, down from the previously published 0.7 percent increase. This followed a virtually unchanged July increase. Transportation equipment, up five of the last six months, led the increase, $8.1 billion or 0.9 percent to $919.1 billion.
• Inventories of manufactured durable goods in August, up eleven consecutive months, increased less than $0.1 billion or virtually unchanged to $590.9 billion, up from the previously published virtually unchanged decrease. This followed a 0.3 percent July increase. Primary metals, up six consecutive months, drove the increase, $0.3 billion or 0.7 percent to $48.1 billion. Inventories of manufactured nondurable goods, up three consecutive months, increased $0.2 billion or 0.1 percent to $357.6 billion. This followed a 0.1 percent July increase. Petroleum and coal products, also up three consecutive months, led the increase, $0.1 billion or 0.3 percent to $44.4 billion. By stage of fabrication, August materials and supplies decreased 0.1 percent in durable goods and increased 0.2 percent in nondurable goods. Work in process decreased 0.3 percent in durable goods and 0.1 percent in nondurable goods. Finished goods increased 0.5 percent in durable goods and were virtually unchanged in nondurable goods.

To gauge the effect of August factory inventories on 3rd quarter GDP, they must first be adjusted for changes in price with appropriate components of the producer price index…by stage of fabrication, the value of finished goods inventories was 0.3% higher at $333,224 million; the value of work in process inventories was 0.2% lower at $262,154million, and the value of materials and supplies inventories was virtually unchanged at $353,052 million.…meanwhile, the producer price index for August indicated that prices for finished goods were on average 0.1% higher, that prices for intermediate processed goods were 0.4% higher, and that prices for unprocessed goods were 1.1% lower….assuming average valuations will be similar for like types of inventories, we could thus estimate that August’s real finished goods inventories increased by 0.2%, that real inventories of intermediate processed goods were 0.6% lower, and that real raw material inventory inventories were about 1.1% greater…while on net it appears that August’s real inventories were thus about 0.2% higher, they follow July’s factory inventory change, when real inventories were lower by somewhat more…since real NIPA factory inventories were down sharply in the 2nd quarter, accounting for over 80% the quarter’s record inventory decrease, that the 3rd quarter appears to indicate just a small real decrease in aggregate factory inventories would therefore mean that the difference between the 2nd quarter decrease and the July decrease would be added to the 3rd quarter’s real growth in GDP

August Wholesale Sales Up 0.1%, Wholesale Inventories Virtually Unchanged

The August report on Wholesale Trade, Sales and Inventories (pdf) from the Census Bureau estimated that the seasonally adjusted value of wholesale sales during the month was $711.1 billion, up 0.1 percent (±0.4 percent)* from the revised July level, and 6.1 percent (±0.9 percent) higher than the wholesale sales of August 2024… the July preliminary sales estimate was revised down to $710.56 billion from the $711.35 billion in wholesale sales reported two months ago, which thus revised the June to July change in sales from up 1.4% (±0.5 percent)* to up 1.3 percent (±0.5 percent)*…as an intermediate economic activity, wholesale sales are not included in GDP except insofar as they are a trade service, since the traded goods themselves do not represent an increase in the output of the goods produced or finally sold….

On the other hand, the monthly change in private inventories is a major factor in GDP, as additional goods on the shelf represent goods that were produced but not sold, and this August report estimated that wholesale inventories were valued at a seasonally adjusted $907.9 billion at month end, virtually unchanged (+/-0.2%)* from the revised July level, and 1.1 percent (±0.7 percent) higher than in August a year ago…July’s inventory value was revised from the $908.1 billion reported two months ago to $908.0 billion, which revised the July inventory increase from up 0.2 percent (+/-0.2%)* to up 0.1 percent (+/-0.2%)*……

August whoesale inventories would be adjusted for inflation with the appropriate sub-indices of the August producer price index, which showed that aggregate prices for finished goods were on average 0.1% higher, that prices for intermediate processed goods were 0.4% higher, but that prices for unprocessed goods were 1.1% lower….since about 70% wholesale inventories are finished goods and about 30% are commodities, those producer price changes suggest a small real increase in August inventories …however, since the key source data and assumptions (xls) for the third estimate of 2nd quarter GDP indicated that real wholesale inventories were down sharply in the 2nd quarter, accounting for over 35% the quarter’s record inventory decrease, that this report appears to indicate a small real increase in aggregate August’s wholesale inventories would therefore mean the change both the 3rd quarter increase and the 2nd quarter decrease would be added to the 3rd quarter’s real growth in GDP…

Existing Home Sales Rose 1.2% in October

The National Association of Realtors (NAR) reported that their seasonally adjusted count of existing home sales increased 1.2% from September to October, the fourth increase in ten months, projecting that 4.10 million existing homes would sell over an entire year if the October home sales pace were extrapolated over that year, a pace that was also 1.7% above the 4.03 million annual sales rate projected in October of a year ago….August sales, at a 4.05 million annual rate, were revised from the 4.06 million annual rate reported a month ago….the NAR also reported that the median sales price for all existing-home types was $415,200 in October, 2.1% higher than in October a year earlier, which they report was “the 28th consecutive month of year-over-year price gains”…..the NAR press release, which is titled “NAR Existing-Home Sales Report Shows 1.2% Increase in October“, is in easy to read plain English, so if you’re interested in the details on housing inventories, cash sales, distressed sales, first time home buyers, etc., you can easily find them in that press release…since sales of existing properties do not add to our national output, neither these home sales nor the prices for which these homes sell are included in GDP, except insofar as real estate, local government and banking services are rendered during the selling process…

Since this report is entirely seasonally adjusted and at a not very informative annual rate, we usually look at the raw data overview (pdf), which gives us a close approximation of the actual number of homes that sold each month…this unadjusted data indicates that roughly 358,000 homes sold in October, up 0.8% from the 355,000 homes that sold in September, and up by 2.9% from the 348,000 homes that sold in October of last year, so we can see there was only a modest change from the seasonal adjustment to this month’s annualized published figures…that same pdf indicates that the median home selling price for all housing types was 0.7% higher in October, the first increase after three consecutive price deceases, rising from a revised $412,300 in September to $415,200 in October, which was also up 2.1% from the $406,800 median home sales price of October a year ago…by region, median home sales prices ranged from a low of $319,500 in the Midwest to a high of $628,500 in the West, with the Northeast and Midwest, where seasonal factors are more pronounced, showing the steepest decreases in their median sales price over past four months…for both seasonally adjusted and unadjusted graphs and additional commentary on this report, see the following posts from Bill McBride at Calculated Risk: NAR: Existing-Home Sales Increased to 4.10 million SAAR in October and Newsletter: NAR: Existing-Home Sales Increased to 4.10 million SAAR in October, which in turn links to his housing newsletter article on this report…

 

 

(the above is the synopsis that accompanied my regular sunday morning news links emailing, which in turn was mostly selected from my weekly blog post on the global glass onion…if you’d be interested in receiving my weekly emailing of selected links, most of which are chosen from the aforementioned GGO posts, contact me…)