Posts Tagged ‘Pending Home Sales Index’

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Pending Home Sales Index Posts Second Best Month Since April 2010

Friday, January 27th, 2012

Pending Home Sales 2011

After 3 con­sec­u­tive months of growth, the hous­ing mar­ket appears to have eased a bit in December.

Accord­ing to the National Asso­ci­a­tion of REALTORS®, December’s Pend­ing Home Sales Index slipped 4 per­cent from the month prior. The index mea­sures the num­ber of homes under con­tract to sell nation­wide, but not yet sold.

Despite falling below its bench­mark “100 value”, December’s Pend­ing Home Sales Index is the reading’s second-highest value since April 2010 — the last month of last year’s home buyer tax credit program.

In other words, the hous­ing mar­ket con­tin­ues to show signs of improve­ment, pro­pelled by low home prices and the cheap­est mort­gage rates of all-time.

Fred­die Mac’s mort­gage rate sur­vey put the 30-year fixed rate mort­gage at an aver­age of 3.96% in Decem­ber — a 75-basis point improve­ment from Decem­ber 2010. This helps to make homes more afford­able nationwide.

On a regional basis, December’s Pend­ing Home Sales Index varied :

  • North­east Region: –3.1 per­cent from Novem­ber 2011
  • Mid­west Region : +4.0 per­cent from November 2011 
  • South Region : –2.6 per­cent from November 2011
  • West Region : –11.0 per­cent from November 2011

But even regional data is only so help­ful. Like every­thing in real estate, data must be local to be relevant.

Through­out the West Region, for exam­ple, the U.S. region in which pend­ing home sales fell the most, sev­eral states must have per­formed bet­ter than the regional aver­age. And, undoubt­edly, there were cities, towns, and neigh­bor­hoods that expe­ri­enced marked mar­ket growth.

Unfor­tu­nately, the Pend­ing Home Sales Index can’t cap­ture that data. Nor can it iden­tify the mar­kets in which home sales suffered.

For today’s home buy­ers and sell­ers, there­fore, it’s impor­tant to under­stand your local mar­ket and the dri­vers of local activ­ity. Reports like the Pend­ing Home Sales Index can paint a broad pic­ture U.S. hous­ing but for data that mat­ters to you, you’ll want to look local.

For local real estate data, talk to an expe­ri­enced real estate professional.

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Pending Home Sales Index Rises Back Above 100

Friday, December 30th, 2011

Pending Home Sales IndexLow home prices and mort­gage rates have com­bined to push home afford­abil­ity to record lev­els nation­wide. Home buy­ers are tak­ing advantage.

The Pend­ing Home Sales Index rose 7 per­cent in Novem­ber to rise to its high­est level since April 2010, the last month of last year’s home buyer tax credit program. 

The Pend­ing Home Sales Index is pub­lished monthly by the National Asso­ci­a­tion of REALTORS®. It mea­sures homes under con­tract nation­wide, but not yet “sold”. 

In this way, the Pend­ing Home Sales Index is dif­fer­ent from other hous­ing mar­ket indi­ca­tors. It’s a “forward-looking” fig­ure; a pre­dic­tor of future home sales. Accord­ing to the National Asso­ci­a­tion of REALTORS®, more than 80% of homes under con­tract close within 60 days. 

By con­trast, hous­ing data such as the Exist­ing Home Sales report and the New Home Sales report “look back”.

Novem­ber marks the sec­ond straight month of Pend­ing Home Sales Index improvement. The hous­ing mar­ket met­ric made big gains of 10 per­cent in Octo­ber 2011, as well.

On a regional basis, each part of the coun­try showed an increase in homes under contract.

  • North­east Region: +8.1 per­cent from Octo­ber 2011
  • Mid­west Region : +3.3 per­cent from Octo­ber 2011 
  • South Region : +4.3 per­cent from Octo­ber 2011
  • West Region : +14.9 per­cent from Octo­ber 2011

How­ever, we must dis­count the value of even the regional data, somewhat. Like else in real estate, the vol­ume of homes going under con­tract vary by locality.

Through­out the West Region, for exam­ple, the region in which pend­ing home sales increased the most from Octo­ber, there are nearly a dozen states. Undoubt­edly, some of those states per­formed bet­ter than oth­ers in terms of “homes under con­tract”, but we don’t have an indi­ca­tion of which states those were.

In addi­tion, within each state, every city, town, and neigh­bor­hood real­ized its own unique mar­ket in Novem­ber, and pro­duced its own sales statistics.

For buy­ers and sell­ers through­out the coun­try, there­fore, it’s more impor­tant to watch data on a local level than on a national one. Reports like the Pend­ing Home Sales Index are help­ful in show­ing national trends, but as an indi­vid­ual, what you need are local trends.

For local real estate data, be sure to ask your agent.

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Despite Low Rates, Pending Home Sales Slip In August

Friday, September 30th, 2011

Pending Home Sales graphDespite the low­est mort­gage rates of all-time, home buy­ers are slow­ing the pace at which they’re buy­ing homes.

Accord­ing to the National Asso­ci­a­tion of REALTORS®, on a seasonally-adjusted basis, the Pend­ing Home Sales Index fell 1 per­cent in August.

The Pend­ing Home Sales Index mea­sures homes under con­tract, but not yet sold, nation­wide. In this respect, the Pend­ing Home Sales Index is a forward-looking hous­ing mar­ket indi­ca­tor; a pre­dic­tor of future home sales.

It’s one of the few national indices that “looks ahead” to future mar­ket con­di­tions. Most hous­ing data, by con­trast, describes past events.

On a regional basis, only the South Region showed improve­ment in August’s Pend­ing Home Sales Index report : 

  • North­east Region: –5.8%
  • Mid­west Region : –3.7%
  • South Region : +2.6%
  • West Region : –2.4%

That said, even the value of regional data can be ques­tioned. Like all things in real estate, the num­ber of homes going under con­tract will vary on the local level.

For exam­ple, in the North­east Region where pend­ing home sales slipped in August, there are close to a dozen states. Some of those states per­formed bet­ter than oth­ers, and there is no doubt that cities and towns exist in the region in which pend­ing home sales actu­ally climbed.

As a national/regional report, the Pend­ing Home Sales Index can­not show local mar­ket data and, for that rea­son, it’s some­what irrel­e­vant to every­day buy­ers and sell­ers. If you’re in the mar­ket to buy or sell a home today, it’s your local hous­ing mar­ket data that mat­ters to you. 

We watch the Pend­ing Home Sales Index because it paints a broad pic­ture of hous­ing nation­wide. To get local mar­ket con­di­tions, though, you’ll want to talk with a local real estate professional.

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