Pending home sales up year-over-year, despite monthly drop
Posted on Thursday, August 29, 2013 at 10:44:05 AM
As an indicator of potential housing market activity, pending home sales dropped on a monthly basis in July, as mortgage rates may have limited the number of buyers using residential financing.
However, there is good news. While the Pending Home Sales Index did decrease more than 1 percent, from 110.9 in June to 109.5 in July, on a year-over-year basis the sales figure was still higher, according to data from the National Association of Realtors. This also marked 27 consecutive months of increases.
Additionally, Lawrence Yun, NAR chief economist, believes that the housing market is relatively uneven across the country, with different regions reporting varying conditions.
"The modest decline in sales is not yet concerning, and contract activity remains elevated, with the South and Midwest showing no measurable slowdown," Yun stated. "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."
In other positive news, overall improvements are being reported across multiple segments of the housing sector, and a continued upward trend is expected, according to Business Insider. Housing also appears tied to other global markets, as many wait for word from the Federal Reserve about potential policy changes.
For those using residential financing to buy, there are still a number of positive indicators in the housing market.