October existing home sales see ‘spectacular’ 26.6% annual gain

October’s 26.6% y/y gain in unit home sales as reported by CNBC’s Diana Olick is indeed “spectacular” in the words of the prolific Lawrence Yun. That the month’s sales was recorded on the basis of a 19.8% y/y drop in supply and led to a 15.5% y/y increase in median home price leads one to be concerned about the impact of any shifts in the characteristics of the homes on the market, however unlikely given the scope of this measurement.

One intriguing option for answering this query is the Common Haus Price Index created by Ralph McLaughlin at Haus.com which tracks the asking price of homes within markets on a like-to-like basis. The chart below shows a “clear, though not perfect, correlation between the CHPI home value in a market and the year-over-year decrease in inventory.” So, looks like I can sleep well tonight having (sorta) addressed my concern.