Existing-home sales continue decline, prices stay strong
Existing-home sales declined for the second consecutive month in October, the National Association of Relators reported. Still, home prices stayed strong thanks to tight inventory.
Total existing-home sales were down 3.2% to a seasonally adjusted annual rate of 5.12 million. Nevertheless, this is still a 6.0% improvement over October 2012, and the 28-month streak of year-over-year improvement remains unbroken.
Single-family home sales were down 4.1% to a seasonally adjusted annual rate of 4.49 million, but remained 5.2% above year-ago figures.
Meanwhile, the national median existing-home price was $199,500, up 12.8% year-over-year. Part of this gain is attributed to fewer distressed home sales in 2013.
“The erosion in buying power is dampening home sales,” said NAR chief economist Lawrence Yun. “Moreover, low inventory is holding back sales, while at the same time pushing up home prices in most of the country. More new home construction is needed to help relieve the inventory pressure and moderate price gains.”
Total housing inventory was down 1.8% to 2.13 million homes available for sale, marking a 5.0-month supply up marginally from September’s.
Retail sales up 0.4% in October
Advance estimates for retail and food service sales came in at $428.1 billion for the month of October, a larger-than-expected increase of 0.4%, the U.S. Census Bureau reported. September sales also enjoyed an upwardly revised boost from -0.1% to an increase of 0.5%.
Retail trade sales largely mirrored that of total retail and food service sales, both of which were up 3.9% over last year.
Adjusted totals for building material and garden equipment & supplies dealers (NAICS 444) were $25.8 billion, a 1.9% decrease since September. However, the figures maintain an edge over October 2012 by a margin of 4.2%.
Auto and other motor vehicle dealers realized the largest year-over-year improvement at 11.9%, with nonstore retailers close behind at 8.2%.
Many economists expected sales to flatline or decline in October due to the steep drop in consumer confidence caused by the government shutdown. The relatively optimistic report suggests that holiday sales may be higher than expected this year, though Gallup just issued a rather uninspired forecast.
Valspar finishes strong in fiscal 2013
Valspar reported fourth-quarter net sales of $1.1 billion, up 8% versus the prior year.
Fourth-quarter 2013 adjusted net income was $86 million, compared with $80 million a year ago.
"The fourth quarter was a good finish to the year as growth in both sales and operating income improved from previous quarters. Sales growth was led by strong performance in our U.S. Consumer, Wood and Coil product lines and by the acquisition of Inver,” said Gary E. Hendrickson, chairman and CEO. “We saw the benefit of new business wins in all product lines. These wins were partially offset by weakness in certain end markets and international regions, as has been the case throughout 2013.”
For the full year, the company reported sales of $4.1 billion, up 2%. Fiscal year 2013 adjusted net income was $320 million, compared with $310 million a year ago.
Looking ahead to fiscal 2014, Hendrickson said, “We expect stronger sales and earnings growth through continued new business, benefits from acquisitions, a stable U.S. market and through our productivity initiatives."
The company expects sales to increase 7% to 9% in fiscal 2014.