National Association of Realtors releases latest report
Home sales based on contract signings have continued to decline for the second straight month – a sign that the red-hot housing market could be cooling off, according to the National Association of Realtors.
NAR's Pending Home Sales Index (PHSI), released Monday, showed a 1.8% month-over-month drop in July to a reading of 110.7. Year over year, the index was down by 8.5%.
"The market may be starting to cool slightly, but at the moment, there is not enough supply to match the demand from would-be buyers," said NAR chief economist Lawrence Yun. "That said, inventory is slowly increasing, and home shoppers should begin to see more options in the coming months."
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Yun noted that homes listed for sale are still seeing strong demand, "but the multiple, frenzied offers – sometimes double-digit bids on one property – have dissipated in most regions."
He added that even in a somewhat calmer market, about 27% of homebuyers still choose to waive appraisals and inspections to speed up the homebuying process.
Broken down by regions, the Northeast PHSI posted a 6.6% decline to 92, Midwest PHSI dropped 3.3% to 104.6 last month, and the South index dipped 0.9% to 130.9. Meanwhile, pending home sales in the West increased 1.9% to 99.8% in July.
