The index dipped 1.6 percent in to 107.7rnfrom a revised 109.4 in July.  Still itrncontinued its 28 month streak of annual increases and was up 5.8 percent above itsrnAugust 2012 level of 101.8.</p

The index is a forward-looking indicatorrnbased on home purchase contracts not closings. rnPending sales are generally expected to close within one to two monthsrnof contract signing. </p

Lawrence Yun, NAR chief economist, said the decline was expected following elevatedrnlevels of closed existing-home sales at the end of summer. “Sharply risingrnmortgage interest rates in the spring motived buyers to make purchaserndecisions, culminating in a six-and-a-half-year peak for sales that werernfinalized last month,” he said. “Moving forward, we expect lower levels ofrnexisting-home sales, but tight inventory in many markets will continue to pushrnup home prices in the months ahead.”</p

NAR isrnprojecting that by year-end existing-home sales will total nearly 5.2 million,rnan 11 percent increase from 2012 but it sees little change in 2014, perhapsrnless than 1 percent.  The national medianrnexisting-home price should rise 11 to 12 percent for all of 2013, easing to anrnincrease of 5 to 6 percent in 2014 as housing inventories improve.</p

The Pending HomernSale Index rose 4.0 percent in the Northeast to 84.8 in August, and is 5.1rnpercent above a year ago. In the Midwest the index declined 1.4 percent torn111.6 compared to July but is 13.8 percent higher than August 2012.  Pending home sales in the South fell month-over-monthrnby 3.5 percent to 116.9 but remain 3.7 percent above a year ago. The index inrnthe West declined 1.6 percent in August to 106.9, but is 1.7 percent higherrnthan August 2012.</p

The PendingrnHome Sales Index is based on a large national sample typically representingrnabout 20 percent of transactions for existing-home sales. An index of 100 isrnequal to the average level of contract activity during 2001, which was thernfirst year to be examined.

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