Existing Home Sales

What Are Existing Home Sales?

Existing home sales transaction data measure and report sales and prices of existing single-family homes, condos, and co-ops for the United States, and is broken down by region — West, Midwest, South, and Northeast.

This metric can be contrasted with new home sales and housing starts, which both track newly built homes rather than existing housing stock.

Understanding Existing Home Sales

The existing home sales report is released monthly by the National Association of Realtors (NAR) based on closed residential real estate transactions. It is a lagging indicator since people often make housing choices in response to a change in interest rates.

According to the National Association of Realtors (NAR), the reporting of most existing home sales transactions happens after the closing, and so does not consider pending sales still in contract. The majority of transactions usually involve a mortgage, which may take 30 to 60 days to close on. As a result, existing home sale data most likely includes contracts that were signed at least a month or two before the report is published.

Existing vs. New Home Sales

The U.S. Census Bureau collects and disseminates new home sales data. The bureau defines a new home sale as the signing of a home sales contract, or the acceptance of a deposit. Also, this information comes from new construction permits on the state-level. The house may be at any stage of the construction process.

This process includes those structures not yet started, those under construction, and completed structures. About 25% of the houses sell at the time of completion. The remaining 75% splits equally between those not yet started, and those under construction.

New sales and existing home sales data releases usually occur at around the same time each month. Given the difference in definition, new home sales lead existing home sales with regard to changes in the residential sales market by a month or two. For example, an existing home sale in January was probably signed 30 to 45 days earlier in November or December of the previous year. This lapse is due to the usual time it takes to finalize sale documentation and close a mortgage.

Sources of Home Data

Many different reports analyze the housing market in the United States. These various indicators look at several different aspects of the housing market and give insight into buyer activity and regional trends:

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