Home prices and trends are thought to be a leading indicator of bank credit, and so we pause to analyze what 2018 is telling us and how it could impact our future in the banking industry. December existing homes sales came in at 4.99 million units or below the 5.24 million units expected. That continued the trend of weaker demand in 2018. Luckily, we can correlate much of that drop in demand and pricing to higher interest rates and inflated home prices against a backdrop of flat income.
This might be sign #367 that the next economic apocalypse is forthcoming, but homes that are bought and sold within a 12-month period are on the rise. Back in 2006, according to Trulia, home flips accounted for 7.3% of sales. Now, they account for 6.1%, the highest level since. More disconcerting is the metro patterns are similar with Las Vegas, Florida and Central California leading the way. 11 of these metro areas hit 17-year highs.