Here’s Why Pending Home Sales Continued to Decline in August
According to the National Association of Realtors, The Pending Home Sales Index (PHSI), a forward-looking indicator, fell 1.2% in August to 88.6, down from 89.7 in July. The number is up 7.7% from August 2010.
This data reflects contracts, but not closings, which usually don’t occur until a month or two after contracts are signed.
While PHSI in the Northeast fell 5.8% to 63.6 in August, it is still 1.3% higher than August 2010. In the Midwest, the index fell 3.7% to 76.2 in August but is up 8.2% above a year ago. Pending home sales in the South rose 2.6% to an index of 96.9 and are 7.6% higher than August 2010. In the West, the index declined 2.4% to 108.1 in August but is 10.5% above August 2010 figures.
National Association of Realtors chief economist Lawrence Yun said the decline reflects an uneven market. “The biggest monthly decline was in the Northeast, which was significantly disrupted by Hurricane Irene in the closing weekend of August,” he said. “But broadly speaking, contract signing activity has been holding in a narrow range for many months.”