The NAR data on sales of existing homes in July show a 2.2 percent decline to 4.07 million units at a seasonally adjusted annual rate after an unrevised 4.16 million units in June. Home resales are down 16.6 percent from July 2022. The July reading is below the consensus of 4.07 million units in the Econoday survey of forecasters. NAR Chief Economist Lawrence Yun said"Two factors are driving current sales activity inventory availability and mortgage rates. Unfortunately, both have been unfavorable to buyers."

Resales of single-family units are down 1.9 percent in July to 3.65 million units and down 16.3 percent year-over-year. Resales of multi-unit homes are down 4.5 percent to 420,000 in July and off 19.2 percent compared to a year ago.

While supplies of homes available for sale have improved, these remain lean. In July there is 3.3 months' worth of homes available for sale compared to 3.1 in June, and 3.2 in July 2022. The median price of a home resale is $406,700 in July from June, but up 1.7 percent year-over-year. It is normal for existing home prices to climb in the first half of the year and decline in the second. The July decrease is small.

The average number of days a home was on the market in July was 20 days compared to 18 days in June, and 14 days in July 2022. In July 74 percent of homes sold in under 30 days versus 67 percent in June.

First-time buyers accounted for 30 percent of resales in July compared to 27 percent in June, and 24 percent in July 2022. Yun noted,"Many renters are concerned as they're facing growing affordability challenges because of high interest rates."

A slight decline from June's 4.16 million annual rate to 4.15 million is the expectation for July, a month before mortgage rates started to jump. The National Association of Realtors has been citing lack of available inventory for the slow pace of sales.

Existing home sales tally the number of previously constructed homes, condominiums and co-ops in which a sale closed during the month. Existing homes (also known as home resales) account for a larger share of the market than new homes and indicate housing market trends.

This provides a gauge of not only the demand for housing, but the economic momentum. People have to be feeling pretty comfortable and confident in their own financial position to buy a house. Furthermore, this narrow piece of data has a powerful multiplier effect through the economy, and therefore across the markets and your investments. By tracking economic data such as home resales, investors can gain specific investment ideas as well as broad guidance for managing a portfolio.

Even though home resales don't always create new output, once the home is sold, it generates revenues for the realtor. It brings a myriad of consumption opportunities for the buyer.

Refrigerators, washers, dryers and furniture are just a few items home buyers might purchase. The economic"ripple effect" can be substantial especially when you think a hundred thousand new households around the country are doing this every month. Since the economic backdrop is the most pervasive influence on financial markets, home resales have a direct bearing on stocks, bonds and commodities. In a more specific sense, trends in the existing home sales data carry valuable clues for the stocks of home builders, mortgage lenders and home furnishings companies.