Pending home sales rise for first time since March

Paterniano Del Favero
Agosto 2, 2017

In a report, the National Association of Realtors (NAR) said its pending home sales index increased by a seasonally adjusted 1.5% last month, compared to expectations for a gain of 0.7%. The PHSI posted 110.2 in June, up from 108.6 in May.

"The first half of 2017 ended with a almost identical number of contract signings as one year ago, even as the economy added 2.2 million net new jobs", NAR chief economist Larry Yun said. "Market conditions in many areas continue to be fast-paced, with few properties to choose from, which is forcing buyers to act nearly immediately on an available home that fits their criteria".

Pending home sales in the South rose 2.1% are now 2.6 percent above last June while in the West they grew 2.9% but are still 1.1% below a year ago. "While an increase in pending home sales suggests more home sales will be completed in the months ahead, data on the number of homes available for sale continued to decline in June, to 11 percent below the level we saw at this time previous year".

A key development in existing-home sales activity in June could predicate relief for homebuyers, especially first-time buyers, according to Yun.

A breakdown of the figures show that pending home sales increased by 0.7% in the Northeast and are now 2.9% higher than a year ago while in the Midwest they fell by 0.5% and are 3.4% lower year on year.

With supply running at more than 7% below that of a year earlier, but Yun says the tight conditions may actually help first time buyers as there are signs that investors are stepping out of the market. "However, the home search will still likely be a strenuous undertaking in coming months because supply shortages in most areas are most severe at the lower end of the market", added Yun.

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