There was some good news out this week regarding Existing Homes Sales. April sales were the highest level in 40 months. The year-over-year increase of 9.7% is down a little from March, but the numbers are healthy and encouraging regarding more good news in housing and related industries through the near term. The ascent in the monthly data trend, at 44.1%, has been steeper than previous rising trends of this duration, adding to the optimism regarding housing in the coming quarters.
There are two cautionary notes for people given to straight line forecasting. One, the length of rise in the monthly numbers is getting old. It is only three months shy of the longest-normal trend characteristic. Second, the rate of rise appears to be easing, as evidenced by a mild decline in the quarterly rate-of-change and by the fact that the March-to-April increase was milder than each of the last two years. The December-to-March increase in the quarterly moving totals was also milder than the last two years.
Enjoy the ride, but keep in mind that Existing Home Sales are likely to slow in their rate of rise as we traverse the second half of 2013 and that a mild decline in 2014 would be consistent with our general economic outlook for the year.