Pending Home Sales Highest Since June 2013

Momentum appears to be building toward a<bhealthy spring market according to data released today on March pending home sales.  The National Association of Realtors® (NAR)rnsaid its Pending Home Sales Index (PHSI), reached 108.6 in March, a 1.1 percentrnincrease over the previous month.  At thernsame time the February Index number was revised upward from 106.9 to 107.4. </p

March is the third consecutive month thatrnpending sales have increased month over month and the Index is now at its highestrnlevel since June 2013 when it was 109.4. rnThe PHSI was up 11.1 percent from the March 2014 level of 97.7.  It has now increased year-over-year for sevenrnconsecutive months. </p

The PHSI is a leading indicator basedrnon executed home purchase contracts. These contracts are generally expected tornbe reflected in residential sales in about two months. </p

Lawrence Yun, NAR chief economist, said the encouraging pending sales numbers resultedrnfrom more buyers than usual entering this year’s competitive spring market.rn”Demand appears to be stronger in several parts of the country, especially inrnmetro areas that have seen solid job gains and firmer economic growth over thernpast year,” he said. “While contract activity being up convincingly compared torna year ago is certainly good news, the increased number of traditional buyersrnwho appear to be replacing investors paying in cash is even better news. Itrnindicates this year’s activity is being driven by more long-termrnhomeowners.”  </p

However, he also said that “Demand in many markets is far exceeding supply, and properties in Marchrnsold at a faster rate than any month since last summer^. This in turn has pushed home prices to unhealthy levelsrn- nearly four or more times above the pace of wage growth in some parts of therncountry. Simply put, housing inventory for new and existing homes needs tornimprove measurably to improve affordability.” </p

The PHSI in thernNortheast was down (by 1.5 percent) for the fourth straight month to 80.2 butrnis still 0.6 percent above a year ago. In the Midwest the index declined 2.5rnpercent to 107.5 but remained 11.3 percent higher than in March 2014.  </p

Pending homernsales in the South increased 4.0 percent to an index of 126.5, 12.4 percentrnabove last March.  The West was up 1.7rnpercent for the month and 15.6 percent on an annual basis.

All Content Copyright © 2003 – 2009 Brown House Media, Inc. All Rights Reserved.nReproduction in any form without permission of MortgageNewsDaily.com is prohibited.