The National Association of REALTORS’ Pending Home Sales Index is “a forward-looking indicator based on contract signings”. The higher the Pending Home Sales Index number, the more contracts have been signed by buyers that will soon translate to sales.
The latest index was released last week, with the headline:
Pending Home Sales Dip in June
As we reported last month, May’s Index levels were the highest recorded in the last 9 years. The small 1.8% decline from May remains 8.2% over last June and the third highest reading in two years. The NAR headline, while accurate, isn’t the best representation of what really happened.
NAR’s Chief Economist Lawrence Yun points towards “low inventory levels in many markets” leading to “reduced choices” at higher price points for the small decline in National Pending Home Sales.
In every major region of the country, pending sales are up year-over-year as shown by the graph below:
Yun goes on to say that there needs to be a significant influx of inventory into the market before anything will change.
“Unfortunately, because nearly all of these sellers are likely buying another home, there isn’t a net increase in inventory. A combination of homebuilders ramping up construction and even more homeowners listing their properties on the market is needed to tame price growth and give all buyers more options.”
So What Does This Mean To Buyers?
There is a lot of competition out there right now for your dream home. Prices are going to continue to climb, act now before you are priced out of your future home.
What Does This Mean to Sellers?
If you are on the fence about listing your home for sale and debating whether now is the time to move on with your plans of relocating… don’t wait!
There are more buyers that are ready, willing and able to buy their first, second, third, vacation, or investment property now than there has been in years! The supply of homes for sale is not keeping up with the demand of these buyers.
Listing your home for sale now will give you the most exposure to buyers and the best sales price.
Whether you are planning on buying or selling a house this year, waiting to act no longer makes sense.