Pending home sales across the U.S. were flat in July, but tight inventory means prices will probably keep rising
California saw impressive gains in pending home sales for July – but the rest of the U.S. was essentially flat, according to new data from the National Association of Realtors.
Pending home sales in the U.S. saw a marginal rise in July, with the NAR’s Pending Home Sales Index creeping up half a percentage point from June to 110.9. While the index’s month-over-month gain was barely a twitch, the index was up 7.4% from July of 2014, marking the 11th consecutive month of annual gains.
NAR chief economist Lawrence Yun said July’s performance is a positive note for the housing market.
“Led by a solid gain in the Northeast, contract activity in most of the country held steady last month, which bodes well for existing sales to maintain their recent elevated pace to close out the summer,” he said. “While demand and sales continue to be stronger than earlier this year, Realtors have reported since the spring that available listings in affordable price ranges remain elusive for some buyers trying to reach the market and are likely holding back sales from being more robust.”
With inventory shortages likely to persist into autumn, Yun said he expects the median existing-home price in the U.S. to increase 6.3% in 2015 to $221,400. He also projected that existing home sales would jump 7.1% to around 5.29 million. That’s about 25% below the peak of 7.08 million set in 2005.
“In light of the recent volatility in the stock market, it's possible some prospective buyers may err on the side of caution and delay decisions, while others may view real estate as a more stable asset in the current environment,” Yun said. “Overall, the prospects for ongoing strength in the housing market remain intact for now. The U.S. economy is growing — albeit at a modest pace — and the labor market continues to add jobs.”
Pending home sales in the U.S. saw a marginal rise in July, with the NAR’s Pending Home Sales Index creeping up half a percentage point from June to 110.9. While the index’s month-over-month gain was barely a twitch, the index was up 7.4% from July of 2014, marking the 11th consecutive month of annual gains.
NAR chief economist Lawrence Yun said July’s performance is a positive note for the housing market.
“Led by a solid gain in the Northeast, contract activity in most of the country held steady last month, which bodes well for existing sales to maintain their recent elevated pace to close out the summer,” he said. “While demand and sales continue to be stronger than earlier this year, Realtors have reported since the spring that available listings in affordable price ranges remain elusive for some buyers trying to reach the market and are likely holding back sales from being more robust.”
With inventory shortages likely to persist into autumn, Yun said he expects the median existing-home price in the U.S. to increase 6.3% in 2015 to $221,400. He also projected that existing home sales would jump 7.1% to around 5.29 million. That’s about 25% below the peak of 7.08 million set in 2005.
“In light of the recent volatility in the stock market, it's possible some prospective buyers may err on the side of caution and delay decisions, while others may view real estate as a more stable asset in the current environment,” Yun said. “Overall, the prospects for ongoing strength in the housing market remain intact for now. The U.S. economy is growing — albeit at a modest pace — and the labor market continues to add jobs.”
