June Pending Home Sales Rise 0.3% in First Increase Since February
Washington, D.C., July 27, 2023-Pending home sales registered a modest increase of 0.3% in June from the previous month--the first increase since February--according to the National Association of Realtors (NAR).
The South and West posted monthly losses, while sales in the Northeast and Midwest grew. All four U.S. regions saw year-over-year declines in transactions.
"The recovery has not taken place, but the housing recession is over," says NAR Chief Economist Lawrence Yun. "The presence of multiple offers implies that housing demand is not being satisfied due to lack of supply. Homebuilders are ramping up production and hiring workers."
The Pending Home Sales Index (PHSI), a forward-looking indicator of home sales based on contract signings, rose 0.3% to 76.8 in May. Year over year, pending transactions fell by 15.6%. An index of 100 is equal to the level of contract activity in 2001.
The NAR expects existing-home sales to decrease 12.9% from 2022 to 2023, settling at 4.38 million, before climbing 15.5%, to 5.06 million in 2024. Housing starts will drop 5.3% from 2022 to 2023, to 1.47 million, before increasing to 1.55 million, or 5.4%, in 2024, the NAR predicts.
Newly constructed home sales are expected to increase over last year by 12.3% due to additional inventory in this segment of the market, and increase by another 13.9% in 2024, to 820,000.