The National Association of Realtors (NAR) Monday morning released its data on pending sales of existing homes for October. The pending home sales index ticked up by 0.2% to 107.7 from an upwardly revised September reading of 107.5. The index had fallen for the prior two consecutive months. The September reading is up 3.9% year over year.
The consensus estimate called for a month-over-month increase of 1% in pending sales. The index reflects signed contracts, not sales closings. An index reading of 100 equals the average level of contract signings during 2001.
The index has been above 100 (the “average” reading) for 14 straight months.
The NAR’s chief economist noted:
Contract signings in October made the most strides in the Northeast, which hasn’t seen much of the drastic price appreciation and supply constraints that are occurring in other parts of the country. In the most competitive metro areas – particularly those in the South and West – affordability concerns remain heightened as low inventory continues to drive up prices.
By region, home sales increased by 4.5% to an index score of 93.6 in the Northeast, which is currently 6.8% higher than in October of 2014. In the South, sales fell 1.7% to an index score of 118.1, and they are now 0.3% below the October 2014 index.
Sales rose by 1.7% in the West to an index score of 106.2 and are now up 10.4% compared with October 2014. Sales in the Midwest declined 1% to an October index score of 103.9, still 3.3% higher than a year ago.
With housing demand expected to remain stable through the final two months of 2015, NAR chief economist Lawrence Yun forecasts existing home sales to finish the year at an annual rate of 5.3 million, the highest sales rate since 2006.
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