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.

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.

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Pending Home Sales Rebounds In August After Sluggish July Report

The National Association of Realtors (NAR) is reporting that pending home sales rebounded in August by 1.6% after a sluggish July. The Pending Home Sales Index (PHSI), which NAR says is a forward-looking indicator based on contract signings, increased to 107.3 in August, rising from 105.6 in July. All regions saw increases per the index according to the report.

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. An index level of 100 is equivalent to a normal level according to the NAR. Lawrence Yun, chief economist for the NAR see the report as positive sign for the real estate industry. He states “It is very encouraging that buyers are responding to exceptionally low interest rates. The notable sales slump in the West region over recent years appears to be over. Rising demand will reaccelerate home price appreciation in the absence of more supply.”

As stated earlier all regions saw an increase in the PHSI with the highest increase being in the West growing at 3.1%. The Northeast, of importance to the New York City region rose 1.4% to 94.3. It is now 0.7% higher than a year ago. Pending home sales in the South increased 1.4% to an index of 124.4 in August, which is an increase of 1.8% year to year. The Midwest saw an increased in the index of 0.6% to 101.7 in August, which is 0.2% higher than August 2018. 

With respect to the forecast of sales ahead Yun believes that we are in need of higher home construction activity. He states “With interest rates expected to remain low, home sales are forecasted to rise in the coming months and into 2020. Unfortunately, so far in 2019, new home construction is down 2.0%. The hope is that housing starts quickly move into higher gear to meet the higher demand. Moreover, broader economic growth will strengthen from increased housing activity.” The NAR is predicting “home sales to rise 0.6% in 2019 and another 3.4% in 2020. Housing starts are predicted to increase by 2.0% in 2019 and jump an additional 10.6% in 2020, which in turn raises GDP to growth at 2.0% in 2020.”

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.

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Pending Home Sales Increase For A Second Consecutive Month

In what can only be described as a positive sign for the real estate industry, pending home sales increased for a second consecutive month after seeing sluggish signs for the 17 months preceding. The National Association of Realtors (NAR) released their June pending home sales report which indicated according to their Pending Home Sales Index that contracts increased 2.8% to 108.3 in June and up from 105.4 in May 2019. The Pending Home Sales Index shows that all major regions saw an increase.

Lawrence Yun, chief economist for the National Association of Realtors has foreseen a positive trend in real estate. He states ” Job growth is doing well, the stock market is near an all-time high and home values are consistently increasing. When you combine that with the incredibly low mortgage rates, it is not surprising to now see two straight months of increases. He further states “Homes are selling at a breakneck pace, in less than a month, on average, for existing homes and three months for newly constructed homes. Furthermore, homeowners’ equity in real estate has doubled over the past six years to now nearly $16 trillion. But the number of potential buyers exceeds the number of homes available. We need to see sizable growth in inventory, particularly of entry-level homes, to assure wider access to homeownership.”

As stated all major regions saw an increase in pending home sales. Of important for us here in the Northeast, we have seen an increase of 2.7% in the Northeast and is .9% higher than the same time last year. The highest growth was seen in the West where the Pending Home Sales Index increase 5.4%.

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/pending-homes-sales-increase-june-2019/

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