This Just In: On August 27th, the National Association of Realtors (NAR)® reported a 3rd consecutive month of growth for pending home sales. The news release states that “Each of the four major regions saw gains in both month-over-month and year-over-year pending home sales transactions.”
Let’s talk a bit about what the Pending Home Sales Index (PHSI) is and what it means for the market in the months to come. The PHSI is a predictive indicator of completed home sales based on contract signings. In short, the more homes that are in contract, the more homes are likely to close in the month or two to follow. The PHSI rose 5.9% to a measure of 122.1 in July (the most recent, analyzed month of data). The index of 100 is equal to the level of contract activity in 2001, when the index started. The July increase marks a 3rd consecutive month of PHSI growth, which is notable and very positive amidst the fact that we are in a pandemic and just 3 months out of a nationwide economic shutdown.
“We are witnessing a true V-shaped sales recovery as homebuyers continue their strong return to the housing market,” said Lawrence Yun, NAR’s chief economist. “Home sellers are seeing their homes go under contract in record time, with nine new contracts for every 10 new listings.”
Other Notable PHSI Findings:
| All four regional indices recorded increases in contract activity on a month-over-month basis in July.
| Pending home sales in the West rose 6.8% in July to 106.4, up 13.2% from a year ago.
| Pending home sales are up 15.5 nationally compared to this time last year.
| Mortgage News Daily (MND) reports that the PHSI represents the highest home sales since July.
| MND also cites that existing home sales are expected to ramp up to 5.8 million in the 2nd half of 2020, with a 2021 sales forecast of 5.86 million.
Thinking of selling and wondering what the PHSI means for you? Hoping to buy but worried the PHSI means competition is abound? Please feel free to reach out with any questions, at any time: firstname.lastname@example.org
Pending Home Sales Rise 5.9% in July
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