September Pending Home Sales Rose 0.5% from August
Washington, DC, October 25, 2018-Pending home sales increased 0.5% to 104.6 in September from 104.1 in August, according to the Pending Home Sales Index.
However, year-over-year, contract signings dropped 1.0%, making this the ninth straight month of annual decreases.
Lawrence Yun, NAR chief economist, says that even though we are still seeing year-over-year declines, the latest monthly increase is a good, stabilizing trend. “This shows that buyers are out there on the sidelines, waiting to jump in once more inventory becomes available and the price is right,” he said.
Yun continues to point to the lack of inventory of moderately priced homes and affordability as factors restraining the housing market but when viewed through the lens of the last few decades, the current affordability climate is still favorable. “When compared to the year 2000, when the housing market was considered very healthy, and home sales figures were roughly equivalent and the affordability conditions were much lower compared to now. So even though affordability has been falling recently, the demand for housing should remain steady.”
While the economy, is thriving it has yet to have a substantial impact on the real estate market. However, Yun believes that may be about to change. “The general condition of the economy is excellent, it simply has not lifted home sales this year,” said Yun. “Home prices are still rising, so people who are purchasing are still seeing wealth gains.”