The National Association of Realtors’ Pending U.S. Home Sales Index rose rose 6.7 percent from March to April and is up 3.2 percent on a year-over-year basis. The bulk of the YOY gains have, however, occured in the Midwest with the West down 2.9 percent.
The Pending Home Sales Index in the Northeast shot up 32.6 percent to 78.9 in April and is 0.8 percent above a year ago. In the Midwest the index rose 9.8 percent to 90.4 and is 11.1 percent above April 2008. The index in the South slipped 0.2 percent to 93.0 in April but is 3.5 percent higher than a year ago. In the West the index rose 1.8 percent to 94.8 but is 2.9 percent below April 2008.
∙ Pending Home Sales Up for Three Months in a Row [NAR]
Key word is Pending. What happens when it’s time to close with interest rates being a percent higher than in April and they don’t qualify anymore? That one percent equals roughly 10% less house that they can afford.
interest rates are usually locked for 60 days if you agree to lock it in, so a change at close usually does not happen, unless the interest rate lock has expired or was left floating at the choice of the buyer.
Data point does not apply to city of San Francisco.
Good thing the NAR is keeping us up to date with un-biased fresh information on the hot state of the housing market as sales “shoot up.”
Key here is “pending”. If it takes longer to close, pending sales will go up regardless of whether actual sales rate is going up or down. Take me for an example. I went into contract to buy a SFH in SF and the seller immediately declared bankruptcy, triggering what I expect to be a prolonged legal action. Am I a “pending sale” for the next 5-6 months?
March was a very dark time. The Dow hit 6500; now it’s at 8700. Lending couldn’t have been any tighter than it was in March. Things look bright.
As J.P. Morgan said, pointing to the mansions on Fifth Avenue, “All of those were built by bulls.”
Good thing the NAR is keeping us up to date with un-biased fresh information on the hot state of the housing market as sales “shoot up.”
Funny, a text search for “shoot up” in the NAR article resulted in a “Text not found.”
Should I try “hot” too?
What about in other years? What is the typical increase in month to month – March to April – increase in pending home sales? J
JWB: my condolences on the seller bankruptcy. Your earnest money is in escrow with the title company, correct? If so it seems like you’ll come out of this with either the house or your money back… eventually.
@anonn.
Funny, a text search for “shoot up” in the NAR article resulted in a “Text not found.”
Should I try “hot” too?
You need to work on your search skillz. You shouldn’t have to look very deep, it’s right in the quote SS put up:
The Pending Home Sales Index in the Northeast shot up 32.6 percent to 78.9 in April and is 0.8 percent above a year ago.
Granted it’s referring to sales in the Northeast. 😉
JWB, that’s a good question. The first hint that this is a flexible “statistic” is that it is an “index”.
The second hint, is that I was unable to find a definition of how the index is calculated, other than a vague description that it is “based upon” pending sales in the prior month and that 100 is comparable to 2001.
As far as I can tell, the number is essentially whatever the NAR decides it is, and that’s what they publish. WHen I go to this page, there is a link that purportedly tells me how they calculate it. When I go to that link, there is NO information regarding how they calculate it. Here’s the first link:
http://www.realtor.org/research/research/phsdata
The closest thing the second link says is that they change it as they see fit. Uh oh!
The quote to which I refer:
“Since the Index is based on aggregated trends in the data, the fallout rate will not skew the index unless there is an abnormal spike or decline in cancellations. NAR will monitor the fallout rate by observing selected MLSs each month. If there is an abnormal change in the trend, NAR will make adjustments to the index to correct for these distortions”
The second link:
http://www.realtor.org/research/research/phsbackground
Does anyone have any better information? If not, I’m afraid this is as useful as “now is a good time to buy and sell real estate”, which is to say, not very useful at all. This just looks like some number that Lawrence Yun pulls out of thin air every month, by “basing” it upon actual data. Thanks Larry!
Ah, “shot up.” OK then. “Hot hot hot” it is. In Manchester, NH.
Funny, my first thought is not “hot” when I think of New Hampshire.
the meaning of the data is clear.
everybody wants to live in the midwest.
the midwest is “special”
sorry SF.
🙂
Maybe ex SF-er…although I doubt those that have left the midwest are still checking in regularly to housing forums etc in the places they left!!
🙂