Pending home sales fell in August compared with July but rose over 6% compared with the results in August 2014. Under the circumstances, NAR is justified in calling this result a “healthy level of activity.” For the full story, listen to Lawrence Yun, NAR chief economist. (The Pending Home Sales Index is a forward-looking indicator of the housing market. It measures home purchase contract signings and is a good indicator of actual closings in the next few months.) Here’s Lawrence:
Pending home sales were mostly unchanged in July, but rose modestly for the sixth time in seven months and are now 7.4 % above July 2014. Lawrence Yun, NAR chief economist, says while demand and sales continue to be stronger than earlier this year, Realtors® have reported that low inventory is likely holding back sales. There is regional variation in the real estate markets with the Northeast leading the pack. The index in the West declined 1.4% in July compared with June, but is still 7.5% above a year ago.
See Yun’s full interview on the latest Pending Home Sales Report:
After five consecutive months of increases, pending home sales slipped in June according to the National Association of Realtors®. Still, June’s sales remained near May’s level, which was the highest in over nine years, Modest gains in the Northeast and West were offset by larger declines in the Midwest and South.
The Pending Home Sales Index is a forward-looking indicator based on home sale contract signings. The dip of 1.8 percent from May to June still puts the PHSI 8.2 percent above June 2014. Despite last month’s decline, the index is the third highest reading of 2015 and has now increased year-over-year for ten consecutive months.
Lawrence Yun, NAR chief economist, says “Competition for existing houses on the market remained stiff last month, as low inventories in many markets reduced choices and pushed prices above some buyers’ comfort level. The demand is there for more sales, but the determining factor will be whether or not some of these buyers decide to hold off even longer until supply improves and price growth slows.”
Pending home sales rose in April for the fourth straight month and reached their highest level in nine years, according to the National Association of Realtors®. The Pending Home Sales Indexis a forward-looking market indicator based on contract signings for the sale of existing homes. The PHSI is now 14.0 percent above April last year — the largest annual increase since September 2012 (15.1 percent). The index has now increased year-over-year for eight consecutive months and is at its highest level since May 2006.
Lawrence Yun, NAR chief economist, says the steady gains in contract activity each month this year highlight the fact that buyer demand is strong. “Realtors® are saying foot traffic remains elevated this spring despite limited — and in some cases severe — inventory shortages in many metro areas…. As a result, home prices are up and accelerating in many markets“
Listen to four minutes and forty-six seconds of Yun analysis here:
According to the chief economist for the National Association of Realtors,® 2015 is shaping up to be the best year for home sales in the last 9 years. On the other hand, he addresses income and wealth inequality as a threat to future growth. All of this came in reporting on the statistics for pending home sales as of the end of March:
The Pending Home Sales Index, a forward-looking indicator based on home purchase contract signings, climbed 1.1 percent to 108.6 in March from an upward revision of 107.4 in February and is now 11.1 percent above March 2014 (97.7). The index has now increased year-over-year for seven consecutive months and is at its highest level since June 2013 (109.4).
Lawrence Yun, NAR chief economist, says contract signings picked up in March as more buyers than usual entered this year’s competitive spring market. “Demand appears to be stronger in several parts of the country, especially in metro areas that have seen solid job gains and firmer economic growth over the past year,” he said.
Yun expects a gradual improvement in home sales in the months ahead but says insufficient supply and accelerating prices could be a drawback to sales reaching their full potential.
On the heels of last week’s positive housing reports, this morning the National Association of Realtors® released another positive report based upon it’s Pending Home Sales Index. The Pending Home Sales Index is a forward-looking indicator based upon contract signings for existing homes. The PHSI for February 2015 is 12% above February 2014 and is now at its highest level since June 2013.
This morning’s headline from the National Association of Realtors® trumpeted “Pending Home Sales Stall in December,” however, the underlying numbers showed that although there was a drop month-to-month from November contracts, there was a large (11.7%) year-over-year gain. The NAR Pending Home Sales Index is a forward-looking indicator based on home sales contract signings. Separately, NAR tracks “foot traffic,” — the number of times lockboxes on listed homes are opened. There was a substantial uptick in foot traffic in December, indicating that Pending Home Sales are likely to improve the next three months.
Lawrence Yun, NAR chief economist, said fewer homes available for sale and a slight acceleration in prices likely led to December’s month-to-month decline in contract signings. “Total inventory fell in December for the first time in 16 months, resulting in fewer choices for buyers and a modest uptick in price growth in markets throughout the country,” he said. “With interest rates at lows not seen since early 2013, the strength in existing-sales in upcoming months will largely depend on the willingness of current homeowners to realize their equity gains from the past couple years and trade up.”
Yun added, “More jobs, increasing consumer confidence, less expensive mortgage insurance and new low down payment programs coming into the marketplace will likely lead to more demand from first-time buyers.”
September sales show a strong increase in median price and price per square foot from September 2013 (18% AND 17%, respectively). There was also heathy increase in sales volume (6.5%). Sales of homes priced over $500,000 increased 110% from September 2013. Overall, we can look back over a strong home-selling season for Flagstaff in 2014.
All of that is good news for home sellers. For prospective buyers looking for a home priced below $400,000, the market remains very tight with well-less than six months’ supply of homes, which is where we’d expect a balance in bargaining power. For sellers above $400,000, even though the market is much improved, the market remains soft – supply is well over 6 months’ worth in all the higher price ranges.
Looking forward, pending home sales (shown in the chart as ACR, PBK and Pending) tell us that the next few months will be slow, and that’s not just seasonal variation. Escrow openings went off the cliff in September according to title company and transaction coordinator sources with whom I’ve talked. Comparing homes under contract as of the beginning of October with the same time last year, the MLS statistics show a drop of 18% in pending sales.
Nationally, employment numbers released this week were encouraging; however, wage growth was “tepid” in the word of a National Association of Realtors® economist. That’s a negative for home purchase affordability and could work against price growth. However limited wage growth removes the specter of inflation, giving the Fed more room to maneuver without raising mortgage rates, which, if they rose, would be a more immediate threat to affordability. Prices will still grow given an expanding buyer base relative to limited supply. The question is, how much will that buyer base expand in Arizona and Flagstaff?
We’ll be keeping our hand on the pulse of the Flagstaff housing market to best advise our clients. When you are ready to buy or sell, give us a call at 928.714.0001, or start by visiting our Flagstaff homes website.
NOTE: THE DATA REPORTED HERE ARE BASED ON HOME SALES IN THE FLAGSTAFF METRO AREA (THE CITY OF FLAGSTAFF AND IMMEDIATELY SURROUNDING COUNTY AREAS THAT HAVE FLAGSTAFF MAILING ADDRESSES) AS REPORTED IN THE MULTIPLE-LISTING-SERVICE MAINTAINED BY THE NORTHERN ARIZONA ASSOCIATION OF REALTORS.® THE DATA MAY NOT REFLECT ALL SALES (BUT IT SURELY REFLECTS MOST OF THEM).
Headlines this morning trumpet a fall in pending home sales in August. The Pending Home Sales Index is forward-looking indicator based on contract signings; pending sales typically close within 60 days. Here’s another example of where, in real estate, it’s a good idea to look beyond the headlines.
Despite the slight decline from the July figure, the index is above 100 – considered an average level of contract activity – for the fourth consecutive month and is at the second-highest level since last August. (These numbers are seasonally adjusted.)
This is also another lesson in the old adage, “all real estate is local.” All major regions experienced declines except for the West, which rose for the fourth consecutive month. The West, of course, is where Flagstaff, AZ real estate is. Here is a truly local report on Flagstaff home sales.
Pending home sales rebounded in July and have now risen in four of the last five months, according to the National Association of Realtors® press release this morning. All major regions experienced healthy gains except for the Midwest, which saw a slight decline. The Pending Home Sales Index,* a forward-looking indicator based on contract signings, is still 2.1 percent below July 2013.
Lawrence Yun, NAR chief economist, says favorable housing conditions are behind July’s higher contract activity. “Interest rates are lower than they were a year ago, price growth continues to moderate and total housing inventory is at its highest level since August 2012,” he said. “The increase in the number of new and existing homes for sale is creating less competition and is giving prospective buyers more time to review their options before submitting an offer.” Yun adds, “More importantly, steady job additions to the economy are helping family finances and giving them added confidence to enter the market.”
Still, Yun expects total home sales for 2014 to fall below results in 2013 by over 2% with median prices up about 5% this year and next.
Nationally, contracts for existing home sales were up slightly in April compared with March, though less than expectations. Sales contracts were also down compared with 2013. The overall uptick included a decline in the West Region of the country, even on a month to month basis.
Flagstaff home sales may be lagging the nation a bit. As of my review of Flagstaff MLS statistics earlier this month, pending home sales were strong; however, May has “seemed” less busy than April. We’ll see next week when I have a new Flagstaff Home Sales Report for you.
The National Association of Realtors® released its monthly Pending Home Sales Index today.
Listen to NAR’s chief economist talk about what the statistics mean in this 3 minute video. The Pending Home Sales Index is a forward-looking real estate market indicator based on contract signings. Nationally, the PHSI declined for the eighth straight month in a row, reaching a low point where it has not been since October 2011.
All real estate is local and there are regional variations in the Pending Home Sales Index. Modest increases in the Midwest and West were offset by declines in the Northeast and South. In other words, our region is better off than much of the rest of the country. Nonetheless, all regions are below a year ago.
Flagstaff pending home sales actually looked strong compared with recent closings in the latest Flagstaff home sales monthly report. If all those Flagstaff contracts close, we’ll have a strong couple of months. Lack of inventory here is discouraging home buyers, as elsewhere in the country.
The National Association of Realtors® today announced its monthly report of homes under contract for sale and the news was not upbeat.
The Pending Home Sales Index, a forward-looking indicator based on contract signings, fell 8.7% to 92.4 in December from a downwardly revised 101.2 in November, and landed 8.8% below December 2012, when it was 101.3. The data are at the lowest level since October 2011, when the index was 92.2. An index reading of 100 equals 2001’s average contract activity level.
All regions of the country suffered in this trend, which was evident in Flagstaff reporting in this blog. Pending contracts for Flagstaff homes dropped thirty units from early December to early January. Still, when we look at final sales year-to-year for January, in the next 10 days or so, things may not be so dismal. The general trajectory for the housing market, as for the economy, is up – just not in a smooth, jet-propelled manner.
Lawrence Yun, NAR chief economist, said several factors are working against buyers. “Unusually disruptive weather across large stretches of the country in December forced people indoors and prevented some buyers from looking at homes or making offers,” he said. “Home prices rising faster than income is also giving pause to some potential buyers, while at the same time a lack of inventory means insufficient choice. Although it could take several months for us to get a clearer read on market momentum, job growth and pent-up demand are positive factors.”
Pending home sales declined for the fourth consecutive month in September, as higher mortgage interest rates and higher home prices curbed buying power
The National Association of Realtors® released its pending home sales numbers for September, showing contracts to purchase homes declined in most markets across the country. September is the first period in more than two years that pending sales weren’t greater than year-earlier levels.
In Flagstaff at the end of September, pending sales were actually quite strong, apparently bucking the national trend. You can see this my monthly Flagstaff home sales report where ACR, PBK and Pending contracts were all enough to push October and November sales into equivalency with recent months. In addition, pending Flagstaff home sales reflected in homes under contract as of October 28 remain about the same as at the end of September.
National home sales numbers less “hot” as the summer wears on. Flagstaff home sales remain active.
Pending home sales statistics are a good predictor of what home sales will be in the near term. Just before the Labor Day holiday, the National Association of Realtors®issued its Pending Home Sales Index for July. The Pending Home Sales (PHS) index measures housing contract activity. It is based on signed real estate contracts for existing single-family homes, condos and co-ops. A high percentage of these contracts close within 30-60 days of signing.
The Pending Home Sales Index declined 1.3% to 109.5 in July from 110.9 in June, but was 6.7% above July 2012 when it was 102.6. The National Association of Realtors®attributes the decline from June to July to rising mortgage rates.
Flagstaff home sales are substantially above 2012 – both in number and in price. There is a slight drop in homes under contract from June to July and August; however, that drop is easily attributed to normal seasonal variation.