Pending Home Sales Post Meager October Gain
Index Stays Near 10-Year High Set in July
The number of contract home signings barely increased in October, but it was enough to nudge the Pending Home Sales Index to it highest level since July, the National Association of Realtors said.
Pending home sales were mostly unchanged, as the PHSI recorded a meager 0.1 percent hike to 110.0, up from 109.9 in September. The index is up 1.8 percent compared to October 2015.
In July, the PHSI rose to its highest point in more than 10 years at 111.2. So the October index is now just 1.2 percentage points away from equaling the lofty pace established last summer.
Despite the minuscule rise in the PHSI, three of the four regions of the nation managed to eke out gains. It rose 0.4 percent in the Northeast to 96.9; the index climbed 1.6 percent in the Midwest to 106.3; it declined 1.3 percent in the South to 120.1; and in the West, the index increased 0.7 percent to 108.3.
More encouraging is the fact contract signings have increased solidly throughout the nation on a year-over-year basis. The Northeast is now up 3.9 percent; the Midwest is 1.2 percent higher; the South is up 0.8 percent; and the West has climbed 2.5 percent.
"Most of the country last month saw at least a small increase in contract signings and more notably, activity in all four major regions is up from a year ago," said Lawrence Yun, chief economist for the NAR. "Despite limited listings and steadfast price growth that's now carried into the fall, buyer demand has remained strong because of the consistently reliable job creation in a majority of metro areas."
Based on home-contract activity, Yun said he expects existing home sales to close out 2016 at a pace of about 5.36 million units. That would surpass 2015 (5.25 million), and also be the most sales since 2006 (6.48 million).