September Pending Home Sales
October 29, 2011 by staff
The pending sales index, * a pointer to the future based on contract signings fell 4.6 percent, to 84.5 in September from 88.6 in August, but is 6.4 percent more than in September 2010, when it stood at 79.4. The data reflect contracts, not closings.
Lawrence Yun, NAR chief economist, said the housing market is still too limited. “A combination of consumer confidence and tight lending standards continue homebuyers retained, although the private sector added nearly 2 million new jobs over the past 12 months,” he said.
The PHSI in the Northeast fell 4.7 percent to 60.6 in September, but is 4.0 percent above a year ago. In the Midwest the index fell 6.2 percent to 71.5 in September, but remains 12.3 percent higher than September 2010. Pending home sales in the South fell 5.5 percent in September to an index of 91.6, but are 5.0 percent above a year ago. In the West, the index decreased 2.1 percent to 105.8 in September, but is 5.6 percent over September 2010.
“The U.S. monetary policy is contradictory and confusing, with some consumers with greater financial capacity and top-notch credit scores pay higher mortgage interest,” said Yun. “The Federal Reserve has obviously been trying to lower mortgage rates, however, more consumers face borrowing handle jumbo interest rates.”
Yun stressed the need to restore the higher loan limits in 42 states. “Just too much for leaving money sitting in banks and not work in the economy is a drag on the global recovery,” he said. “We need a holistic approach to addressing housing problems -. No additional impediments”
The National Association of Realtors (R), “The Voice for Real Estate,” is America’s largest trade association, representing 1.1 million members in all aspects of residential real estate industries and trade.
* The pending sales index is an important indicator for the housing sector, based on pending sales of existing homes. A sale is listed as pending when the contract has been signed but the transaction has not closed, though the sale usually is finalized within one or two months of signing.
The index is based on a large sample, typically representing about 20 percent of the sales transactions of existing homes. In developing the model for the index, showed that the level of monthly sales-contract activity close parallel to the level of home sales in the next two months.
An index of 100 is equal to the average level of contract activity during 2001, which was the first year under review, and the first of five consecutive record years for existing-home sales, but coincides with a level historically healthy.
NOTE: Metro Home Prices / Area Sales in the State of origin for the 3rd quarter will be published November 9. The October home sales were reported on November 21 and the following index of pending sales will be released November 30, the release times are at 10:00 am ET.
Information about NAR is available at www.realtor.org. This and other press releases are published in the media section. The statistics in this release, other tables and surveys can also be found by clicking on the investigation.
REALTOR (R) is a registered collective membership mark that can be used only by real estate professionals who are members of the National Association of Realtors (R) and subscribe to its strict Code of Ethics. Not all real estate agents are REALTORS (R). All Realtors (R) are members of NAR.
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