Pending Home Sales Show Signs of Life
MBA NewsLink Staff
For the first time in a while, pending home sales rose in January, the National Association of Realtors reported yesterday.
The Pending Home Sales Index, a forward-looking indicator based on contract signings, increased by 4.6 percent to 103.2 in January, up from 98.7 in December. Year-over-year contract signings, however, declined 2.3 percent, making the 13th straight month of annual decreases.
All four regions saw growth. The Northeast rose by 1.6 percent to 94.0 in January and improved by 7.6 percent above a year ago. In the Midwest, the index rose by 2.8 percent to 100.2 in January, but fell by0.3 percent from a year ago.
Pending home sales in the South jumped by 8.9 percent to 119.8 in January, but fell by 3.1 percent from a year ago. The West increased by 0.3 percent in January to 87.3 but fell by 10.1 percent from a year ago.
Lawrence Yun, NAR chief economist, said the increase in January was expected. "A change in Federal Reserve policy and the reopening of the government were very beneficial to the market," he said.
Yun also said higher rates discouraged many would-be buyers in 2018. "Homebuyers are now returning and taking advantage of lower interest rates, while a boost in inventory is also providing more choices for consumers," he said. "Income is rising faster than home prices in many areas and mortgage rates look to remain steady. Furthermore, job creation will help lift home buying."