Pending Home Sales: August 2013

Today, the National Association of Realtors (NAR) released their Pending Home Sales Report for August showing that pending home sales declined with the seasonally adjusted national index falling 1.6% from July but increasing 5.8% above the level seen in August 2012.

Meanwhile, the NARs chief economist Lawrence Yun is suggests rising interest rates (as a  result of the Feds "tapering" debacle) worked to motivate spring buyers but now that the seasonal surge is over, lower home sales are expected:

"Sharply rising mortgage interest rates in the spring motivated buyers to make purchase decisions, culminating in a six-and-a-half-year peak for sales that were finalized last month ... Moving forward, we expect lower levels of existing-home sales, but tight inventory in many markets will continue to push up home prices in the months ahead."

The following chart shows the seasonally adjusted national pending home sales index along with the percent change on a year-over-year basis as well as the percent change from the peak set in 2005 (click for larger version).

Pending Home Sales: July 2013

Today, the National Association of Realtors (NAR) released their Pending Home Sales Report for July showing that pending home sales declined with the seasonally adjusted national index falling 1.3% from June but increasing 6.7% above the level seen in July 2012.

Meanwhile, the NARs chief economist Lawrence Yun is suggests that the recent pullback in contract activity does not constitute a general trend while in the Northeast and West, higher rates and prices are having an impact on sales:

"The modest decline in sales is not yet concerning, and contract activity remains elevated, with the South and Midwest showing no measurable slowdown.  However, higher mortgage interest rates and rising home prices are impacting monthly contract activity in the high-cost regions of the Northeast and the West ... More homes clearly need to be built in the West to relieve price pressure, or the region could soon face pronounced affordability problems."

The following chart shows the seasonally adjusted national pending home sales index along with the percent change on a year-over-year basis as well as the percent change from the peak set in 2005 (click for larger version).

Pending Home Sales: June 2013

Today, the National Association of Realtors (NAR) released their Pending Home Sales Report for June showing that pending home sales declined with the seasonally adjusted national index falling 0.4% from May but increasing 10.9% above the level seen in June 2012.

Meanwhile, the NARs chief economist Lawrence Yun is suggests that the recent run-up in interest rates worked to depress the latest read of contract activity:

"Mortgage interest rates began to rise in May, taking some of the momentum out of contract activity in June, ... The persistent lack of inventory also is contributing to lower contract signings."

The following chart shows the seasonally adjusted national pending home sales index along with the percent change on a year-over-year basis as well as the percent change from the peak set in 2005 (click for larger version).

Pending Home Sales: May 2013

Today, the National Association of Realtors (NAR) released their Pending Home Sales Report for May showing that pending home sales improved notably with the seasonally adjusted national index climbing 6.7% from April and increasing 12.1% above the level seen in May 2012.

Meanwhile, the NARs chief economist Lawrence Yun is suggests the spike in contract activity is likely the result of sidelined buyers now jumping to buy before interest rates, increasing for several weeks now, rise further:

"Even with limited choices, it appears some of the rise in contract signings could be from buyers wanting to take advantage of current affordability conditions before mortgage interest rates move higher, ... This implies a continuation of double-digit price increases from a year earlier, with a strong push from pent-up demand."

The following chart shows the seasonally adjusted national pending home sales index along with the percent change on a year-over-year basis as well as the percent change from the peak set in 2005 (click for larger version).

Pending Home Sales: April 2013

Today, the National Association of Realtors (NAR) released their Pending Home Sales Report for April showing that pending home sales improved with the seasonally adjusted national index climbing 0.3% from March and increasing 10.3% above the level seen in April 2012.

Meanwhile, the NARs chief economist Lawrence Yun is suggests that gaining sales and tight inventory should work to continue to push up home prices:

"The housing market continues to squeak out gains from already very positive conditions.  Pending contracts so far this year easily correspond to higher closed home sales in 2013, ... Because of inventory shortages, higher home sales will push up home values to the highest level in five years,"

The following chart shows the seasonally adjusted national pending home sales index along with the percent change on a year-over-year basis as well as the percent change from the peak set in 2005 (click for larger version).

Pending Home Sales: March 2013

Today, the National Association of Realtors (NAR) released their Pending Home Sales Report for March showing that pending home sales improved with the seasonally adjusted national index climbing 1.5% from February and increasing 7.0% above the level seen in March 2012.

Meanwhile, the NARs chief economist Lawrence Yun is beginning to adopt the "narrow range" sentiment of years past as limited supply works to mute sales activity:

"Contract activity has been in a narrow range in recent months, not from a pause in demand but because of limited supply. Little movement is expected in near-term sales closings, but they should edge up modestly as the year progresses, ... Job additions and rising household wealth will continue to support housing demand."

The following chart shows the seasonally adjusted national pending home sales index along with the percent change on a year-over-year basis as well as the percent change from the peak set in 2005 (click for larger version).

Pending Home Sales: February 2013

Today, the National Association of Realtors (NAR) released their Pending Home Sales Report for February showing that pending home sales declined with the seasonally adjusted national index dropping 0.4% from January but increasing 8.4% above the level seen in February 2012.

Meanwhile, the NARs chief economist Lawrence Yun suggests that new home inventory is needed in order to relieve the current "shortage" :

"Only new home construction can genuinely help relieve the inventory shortage, and housing starts need to rise at least 50 percent from current levels, ... Most local home builders are small businesses and simply don't have access to capital on Wall Street. Clearer regulatory rules, applied to construction loans for smaller community banks and credit unions, could bring many small-sized builders back into the market."

The following chart shows the seasonally adjusted national pending home sales index along with the percent change on a year-over-year basis as well as the percent change from the peak set in 2005 (click for larger version).

Pending Home Sales: January 2013

Today, the National Association of Realtors (NAR) released their Pending Home Sales Report for January showing that pending home sales improved notably with the seasonally adjusted national index jumping 4.5% from December and increasing 9.5% above the level seen in January 2012.

Meanwhile, the NARs chief economist Lawrence Yun suggests that while contract activity is on the rise, overall sales for 2013 are projected to increase less than in 2012 while prices should continue to climb:

"Over the near term, rising contract activity means higher home sales, but total sales for the year are expected to rise less than in 2012, while home prices are projected to rise more strongly because of inventory shortages..."

The following chart shows the seasonally adjusted national pending home sales index along with the percent change on a year-over-year basis as well as the percent change from the peak set in 2005 (click for larger version).

Pending Home Sales: December 2012

Today, the National Association of Realtors (NAR) released their Pending Home Sales Report for December showing that pending home sales declined notably with the seasonally adjusted national index falling 4.3% from November but increasing 6.9% above the level seen in December 2011.

Meanwhile, the NARs chief economist Lawrence Yun suggests that while supply limitations may be negativity influencing contract activity, buyer foot traffic is strong:

"The supply limitation appears to be the main factor holding back contract signings in the past month. Still, contract activity has risen for 20 straight months on a year-over-year basis ... Buyer interest remains solid, as evidenced by a separate Realtor survey which shows that buyer foot traffic is easily outpacing seller traffic."

The following chart shows the seasonally adjusted national pending home sales index along with the percent change on a year-over-year basis as well as the percent change from the peak set in 2005 (click for larger version).

Pending Home Sales: September 2012

Today, the National Association of Realtors (NAR) released their Pending Home Sales Report for September showing that pending home sales improved slightly with the seasonally adjusted national index climbing 0.3% since August while increasing 14.5% above the level seen in September 2011.

Meanwhile, the NARs chief economist Lawrence Yun suggests that while recent pending sales activity has been bouncing around the old familiar "narrow range", 2013 should bring a continuation to the overall uptrend:

"Home contract activity remains at an elevated level in contrast with recent years, but currently appears to be bouncing around in a narrow range, ... This means only minor movement is likely in near-term existing-home sales, but with positive underlying market fundamentals they should continue on an uptrend in 2013."

The following chart shows the seasonally adjusted national pending home sales index along with the percent change on a year-over-year basis as well as the percent change from the peak set in 2005 (click for larger version).

Pending Home Sales: August 2012

Today, the National Association of Realtors (NAR) released their Pending Home Sales Report for August  showing that pending home sales declined with the seasonally adjusted national index falling 2.6% since July while increasing 10.7% above the level seen in August 2011.

Meanwhile, the NARs chief economist Lawrence Yun points out that there have been 16 consecutive months of annual gains suggesting that buying activity remains on the mend:

"The performance in month-to-month contract signings has been uneven with ongoing shortages of lower priced inventory in much of the country, and across most price ranges in the West, but activity has remained at notably higher levels this year,... The index shows 16 consecutive months of year-over-year increases, and that has translated into a higher number of closed sales. Year-to-date existing-home sales are 9 percent above the same period last year, but sales were relatively flat from 2008 through 2011,"

The following chart shows the seasonally adjusted national pending home sales index along with the percent change on a year-over-year basis as well as the percent change from the peak set in 2005 (click for larger version).

Pending Home Sales: July 2012

Today, the National Association of Realtors (NAR) released their Pending Home Sales Report for July showing that pending home sales improved with the seasonally adjusted national index climbing 2.4% since June while increasing 12.4% above the level seen in July 2011.

Meanwhile, the NARs chief economist Lawrence Yun points out that there has been no 15 consecutive months of annual gains suggesting that buying activity is on the mend:

"While the month-to-month movement has been uneven, more importantly we now have 15 consecutive months of year-over-year gains in contract activity ... All regions saw monthly increases in home-buying activity except for the West, which is now experiencing an acute inventory shortage,"

The following chart shows the seasonally adjusted national pending home sales index along with the percent change on a year-over-year basis as well as the percent change from the peak set in 2005 (click for larger version).

Pending Home Sales: May 2012

Today, the National Association of Realtors (NAR) released their Pending Home Sales Report for May showing that pending home sales improved notably with the seasonally adjusted national index climbing 5.9% since April while increasing 13.3% above the level seen in May 2011.

Meanwhile, the NARs chief economist Lawrence Yun suggests that 2012 is shaping up to be a "superior" year with sales projected as being up 10% overall for the year.


"The housing market is clearly superior this year compared with the past four years.  The latest increase in home contract signings marks 13 consecutive months of year-over-year gains ... Actual closings for existing-home sales have been notably higher since the beginning of the year and we’re on track to see a 9 to 10 percent improvement in total sales for 2012."

The problem is though, the MBA Purchase Index is not currently capturing any significant rise in purchase contract activity which begs the question... how are the buyers that the NAR sees in the pending index financing their purchase? ... Cash?

The following chart shows the seasonally adjusted national pending home sales index along with the percent change on a year-over-year basis as well as the percent change from the peak set in 2005 (click for larger version).

Pending Home Sales: March 2012

Today, the National Association of Realtors (NAR) released their Pending Home Sales Report for March showing that pending home sales improved notably with the seasonally adjusted national index climbing 4.1% since February while increasing 12.8% above the level seen in March 2011.

Meanwhile, the NARs chief economist Lawrence Yun suggests that, based on the current trends, 2012 could see the best selling in five years.

"The spring home buying season looks bright because of an elevated level of contract offers so far this year, ... If activity is sustained near present levels, existing-home sales will see their best performance in five years. Based on all of the factors in the current market, that’s what we’re expecting with sales rising 7 to 10 percent in 2012."

The problem is though, the MBA Purchase Index is not currently capturing any significant rise in purchase contract activity which begs the question... how are the buyers that the NAR sees in the pending index financing their purchase? ... Cash?

The following chart shows the seasonally adjusted national pending home sales index along with the percent change on a year-over-year basis as well as the percent change from the peak set in 2005 (click for larger version).

Pending Home Sales: February 2012

Today, the National Association of Realtors (NAR) released their Pending Home Sales Report for February showing that pending home sales declined a bit with the seasonally adjusted national index falling 0.5% since January while increasing 9.2% above the level seen in February 2011.

Meanwhile, the NARs chief economist Lawrence Yun suggests that the emerging spring selling season could be strong with potential for the best year seen in five years.

"The spring home buying season looks bright because of an elevated level of contract offers so far this year ... If activity is sustained near present levels, existing-home sales will see their best performance in five years. Based on all of the factors in the current market, that’s what we’re expecting with sales rising 7 to 10 percent in 2012."

The following chart shows the seasonally adjusted national pending home sales index along with the percent change on a year-over-year basis as well as the percent change from the peak set in 2005 (click for larger version).

Pending Home Sales: January 2012

Today, the National Association of Realtors (NAR) released their Pending Home Sales Report for January showing that pending home sales improved with the seasonally adjusted national index climbing 2% since December while increasing 8% above the level seen in January 2011.

Meanwhile, the NARs chief economist Lawrence Yun suggests that today's results indicates "stabilization" for prices and increased activity for the year.

“Given more favorable housing market conditions, the trend in contract activity implies we are on track for a more meaningful sales gain this year. With a sustained downtrend in unsold inventory, this would bring about a broad price stabilization or even modest national price growth, of course with local variations.”

The following chart shows the seasonally adjusted national pending home sales index along with the percent change on a year-over-year basis as well as the percent change from the peak set in 2005 (click for larger version).