Northeast Shows An Increase In Pending Home Sales While The Rest Of The Nation Declines

The National Association of Realtors (NAR) released their report on pending home sales for October 2019. What is shows is that pending home sales nationwide is down 1.7% with only the Northeast region showing an increase in sales. A sale is listed as pending when the contract has been signed however the transaction has not closed. The expectation is that the sale would be finalized within 2 months.

NAR uses their Pending Home Sales Index (PHSI) which they state is an indicator based on contract signings. A index number of 100 on the PHSI is equivalent to the activity in 2001. Their indicator dropped 1.7% to 106.7 in October of 2019. The positive result of the index is that the PHSI is up 4.4% from the same time in 2018.

Lawrence Yun, chief economist for the NAR believes that an uptick in mortgage rates and decrease inventory has affected pending home sales nationwide. Overall he remains positive on the market. He states  “While contract signings have decreased, the overall economic landscape remains favorable. Mortgage rates continue to be low at below 4% – which will attract buyers – employment levels are strong and many recession claims have dissipated.” A continuing call for more available inventory in housing is needed according to Mr. Yun stating “We still need to address and, more importantly, correct inadequate levels of inventory across the country. There is no shortage of buyers seeking homes, but a lack of available units continues to drag down the nation’s housing market and overall economy. We risk a lingering shortage of sufficient inventory if homebuilding only continues at its current pace over the next 20 years, when the U.S. population is projected to increase by more than 40 million over this period. Clearly, home builders must step in and construct more housing.”

Here is a breakdown per region of pending home sales:

Northeast: Northeast saw an increase in the PHSI of1.9% to 95.7 in October. This is 3.0% higher for the same time a year ago.

West: The West saw a decrease of 3.4% for October 2019 to 91.9. The positive is that the PHSI is up 7.5% from October 2018.

South: The South is down 1.7% to an index of 125.3 in October. The PHSI is up 5.1% year over year.

Midwest: The Midwest’s PHSI is down 2.7% to 101.4 last month. Overall it is up 1.8% from the same time last year.

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Northeast Sees Existing-Home Sales Decline Amid A Nationwide Increase

The National Association of Realtors (NAR) is reporting that existing-home sales increased in October 1.9% however there was a split in results in regions with the Northeast and West reporting drops in sales. Existing-home sales are based on transaction closings involving single-family, townhomes, condominiums and co-ops.

The NAR is reporting that existing-home sales increased 1.9% from September 2019 to a seasonally-adjusted annual rate of 5.46 million in October. They indicated that overall sales are up 4.6% from 2018. (5.22 million in October 2018). Median existing-home prices were up 6.2% to $270,900. A year ago existing home prices were at $255,100. All regions saw increases in home prices. The total amount of housing inventory at the end of October was calculated at 1.77 million units which is down approximately 2.7% from September and 4.3% from one year ago. Inventory sat at 1.85 million in October 2018.

Lawrence Yun, chief economist for the NAR believes that the results are positive and sees a positive future. He states  “Historically-low interest rates, continuing job expansion, higher weekly earnings and low mortgage rates are undoubtedly contributing to these higher numbers. We will likely continue to see sales climb as long as potential buyers are presented with an adequate supply of inventory.” He also believes there will be more inventory coming along the way. “The issuance of more housing permits is a very positive sign and a good step toward more inventory,” said Yun, citing the latest data for housing starts. “In order to better counter and even slow the increase in housing prices, home builders will have to bring additional homes on the market” say Yun.

The regional breakdown is as follows:

Northeast: Existing-home sales in the Northeast region fell 1.4% to an annual rate of 690,000. There was no change from 2018 at the same time. The median price in the Northeast was $296,700, up 5.7% from October 2018

West: The West saw a decrease in existing-home sales of 0.9% to an annual rate of 1.13 million in October. The positive is that it is 3.7% above a year ago. The median price in the West was $410,700 which is up 7.8% from October 2018.

South: The South saw an increase of 4.4% to an annual rate of 2.35 million in October. This is up 7.8% from 2018. The median price in the South was $234,900. That is a 6.0% increase from a year ago.

Midwest: Existing-home sales in the Midwest increased 1.6% to an annual rate of 1.29 million. This is a jump of 2.4% from October 2018. The median price in the Midwest was $209,900, an increase of 6.7% increase from the same time last year.

BJD Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx.  Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.

http://bjdpropertymanagement.com/northeast-sees-existing-home-sales-decline-amid-a-nationwide-increase/

Visit us at www.bjdpropertymanagement.com