Pending Home Sales Inched Up in July

Pending home sales were up for the second consecutive month in July, according to data from the National Association of Realtors (NAR).

NAR’s Pending Home Sales Index (PHSI), a forward-looking indicator of home sales based on contract signings, inched up by 0.9% to 77.6 from June to July – an index of 100 is equal to the level of contract activity in 2001. Year-over-year, however, pending transactions fell by 14%.

The regional PHSI readings for the South and West were up month-over-month but were down for the Northeast and South. All four regions recorded year-over-year index declines.

“The small gain in contract signings shows the potential for further increases in light of the fact that many people have lost out on multiple home buying offers,” said NAR Chief Economist Lawrence Yun. “Jobs are being added and, thereby, enlarging the pool of prospective home buyers. However, rising mortgage rates and limited inventory have temporarily hindered the possibility of buying for many.”