Gold prices holding steady gains above $1,925 as U.S. existing home sales drop 1.5% in December
(Kitco News) - Gold prices, while down from their nine-month highs, are holding modest gains following another drop in U.S. existing home sales, according to the latest report from the National Association of Realtors (NAR).
Friday, the association said that existing home sales fell 1.5% to a sales rate of 4.02 million homes in December, the market's eleventh consecutive drop. Although home sales continued to decline into the year-end, the data was better than expected. Economists were looking for a sales rate of 3.95 million.
The gold market is seeing a muted reaction to the latest economic data as some traders take profits after prices hit a nine-month high at the start of the North American trading session. February gold futures last traded at $1.927.10 an ounce, up 0.17% on the day.
The NAR said that existing home sales totaled 5.03 million in 2022, a drop of 17.8% from 2021. Economists note that the Federal Reserve's aggressive monetary policy action, raising interest rates 425 basis points last year, kept many potential home buyers out of the market. At the same time, low supplies of homes for sale kept prices elevated through 2022.
"December was another difficult month for buyers, who continue to face limited inventory and high mortgage rates," said NAR Chief Economist Lawrence Yun. "However, expect sales to pick up again soon since mortgage rates have markedly declined after peaking late last year."
The report said the median price for existing homes in December was $366,900, up 2.3% compared to last year. "This marks 130 consecutive months of year-over-year increases, the longest-running streak on record," the report said.
However, Yun noted that prices could start to reverse as the supply of homes for sale grows.
"Home prices nationwide are still positive, though mildly," Yun added. "Markets in roughly half of the country are likely to offer potential buyers discounted prices compared to last year."
Looking at housing inventories, the report said that as of the end of December, there were 970,000 units for sale, down 13.4% from November but up 10.2% for the year. The number of homes for sale represents a 2.9-month supply, the report added.