Pending home sales fall 7 months straight
Again, the pending home sales index is down; in July it dipped 0.7 percent, according to the National Association of Realtors. That’s the seventh month in a row of continuous declines.
“It’s evident in recent months that many of the most overheated real estate markets — especially those out West — are starting to see a slight decline in home sales and slower price growth,” said Lawrence Yun, chief economist at NAR.
In July, the index decreased to 106.2 down from 107 in June. Now, pending sales are down 2.3 percent year-over-year. Pending home sales measure the number of executed contracts that have cleared all contingencies. Once a home is listed as pending, it is just waiting to close. It is the most accurate indicator of sales within the next 30 days.
Another indicator that’s useful to consider is foot traffic. According to SentriLock LLC, the company that provides electronic lock boxes, buyer traffic was down 1.7 points in June. With fewer showings, it’s no wonder there were fewer contracts.
Going forward, the housing market may be correcting. The days of rising sales and prices may be tempering. Yun expects existing home sales to decrease 1 percent to 5.46 million this year. He said he also expects price increases to moderate.
In the Northeast, pending home sales increased 1 percent to 94.6 in July, but that’s still 2.3 percent below last year.
In the Midwest, the index rose a mere 0.3 percent to 102.2, but is still 1.5 percent below last July.
In the South, the index dropped 1.7 percent to 122.1, that’s 0.9 percent below a year ago.
In the West, it dropped 0.9 percent to 94.7 and that’s almost 6 percent below last July.