Pending home sales jumped 14.5%, compared to September 2011, according to the National Association of Realtors.
The Pending Home Sales Index rose from 86.9 in 2011 to 99.5 as of September 2012 reflecting new home purchase contracts but not closings. In comparison, August pending home sales grew 10.7%, suggesting overall improvement in 2012.
NAR chief economist, Lawrence Yun, stated it is the pending home sales that continue to hold a higher ground. “This means only minor movement is likely in near-term existing-home sales, but with positive underlying market fundamentals they should continue on an uptrend in 2013,” said Yun.
This rise in pending home sales has continued its upward trend for 17 consecutive months on a year-over-year basis. The increase in sales has resulted in the recent recovery in closed existing-home sales this year as well. This September revealed a significant increase in contract activity versus the previous year in every region except the West who struggles with a limited inventory.
“The broad trend in pending home sales mirrors that of the broader housing market and is, yet again, another indicator suggesting that the recovery in housing has broadened and has sustained momentum,” said Barclays Capital (BCS) analyst Michael Gapen, in a note to clients.
It is predicted that over the next year, the conditions of housing will remain affordable, with the 30-year-fixed-rate mortgage remaining remarkably low until it’s gradual 4% rise toward the second half of 2013.
In 2012, it is estimated that completed existing-home sales will increase 9% with a total close of 4.6 million. This number is projected to increase another 9% to 5.1 million in 2013. The national median existing-home price is anticipated to increase 6 percent in 2012 and another 5 percent in 2013 bases upon lower housing inventory.
mhopkins@housingwire.com
