Nine consecutive gains for pending home sales
Pending home sales have risen for nine months in a row, a first for the index since its inception in 2001, according to the National Association of Realtors.
Being at the highest level since March 2006, the Pending Home Sales Index, a leading indicator for the housing sector based on pending sales of existing homes, increased 3.7 percent. The October 2009 index went to 114.1, up from 110.0 in September, and is 31.8 percent above October 2008 when it was 86.6. The rise from a year ago is the biggest annual increase ever recorded for the index.
“This means the tax credit is helping unleash a pent-up demand from a large pool of financially qualified renters, much more than borrowing sales from the future,” said Lawrence Yun, NAR chief economist.
The PHSI in the Northeast surged 19.9 percent in October and is 44.2 percent above a year ago. In the Midwest the index rose 11.6 percent and is 36.6 percent higher than October 2008. Pending home sales in the South increased 5.4 percent and is 31.6 percent above a year ago. In the West the index fell 11.2 percent but is 21.9 percent above October 2008.
“Still, as inventories continue to decline and balance is gradually restored between buyers and sellers, we should reach self-sustaining housing conditions and firming home prices in most areas around the middle of 2010,” said Yun. “That would mean broad wealth stabilization for the vast number of middle-class families.”
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—Kimberly Turner
