NAR Says Home Sales Down, But Cites Other Positive Data
Sunday, April 20, 2008
The National Association of Realtors (NAR) said this week that its Pending Home Sales Index—which measures the number of housing contracts signed—dropped 1.9-percent between February and January of this year and was down 21.4-percent when compared to the same month last year.
“The slip in pending home sales implies we're not out of the woods yet, though an era of successive deep sales declines appears to be over,” said NAR's chief economist Lawrence Yun.
Despite the decrease, Yun predicts existing home sales will increase to a pace of 5.9 million by the fourth quarter of this year. He also expects activity to pick up this summer as improvements are made in the jumbo-loan market and new additions like the economic stimulus packet take effect.
“Existing home sales could start to show a sustained increase within a few months, unless there are some additional economic problems or excessive inflationary pressure,” said Yun. “We're looking for essentially stable sales in the near term, before higher mortgage loan limits translate into more sales in high-cost markets. The wider access to affordable credit should increase sales activity notably this summer as pent-up demand begins to be met.”
According to NAR, housing conditions vary depending on market, with certain parts of the Southwest region standing out.
“Some parts of the country that can expect improvement include the Northeastern region and the oil-patch states of Texas, Oklahoma, Louisiana and Arkansas,” he added. “With lower interest rates and flat home prices in many areas, NAR's housing affordability index is forecast to rise 14-percentage points to 127.0 in 2008.”
Click here to read the full report.
“The slip in pending home sales implies we're not out of the woods yet, though an era of successive deep sales declines appears to be over,” said NAR's chief economist Lawrence Yun.
Despite the decrease, Yun predicts existing home sales will increase to a pace of 5.9 million by the fourth quarter of this year. He also expects activity to pick up this summer as improvements are made in the jumbo-loan market and new additions like the economic stimulus packet take effect.
“Existing home sales could start to show a sustained increase within a few months, unless there are some additional economic problems or excessive inflationary pressure,” said Yun. “We're looking for essentially stable sales in the near term, before higher mortgage loan limits translate into more sales in high-cost markets. The wider access to affordable credit should increase sales activity notably this summer as pent-up demand begins to be met.”
According to NAR, housing conditions vary depending on market, with certain parts of the Southwest region standing out.
“Some parts of the country that can expect improvement include the Northeastern region and the oil-patch states of Texas, Oklahoma, Louisiana and Arkansas,” he added. “With lower interest rates and flat home prices in many areas, NAR's housing affordability index is forecast to rise 14-percentage points to 127.0 in 2008.”
Click here to read the full report.
