According to research by the National Association of Realtors®, pending home sales, homes that have contract to sell but have not closed escrow, have declined for the 4th month in a row. We are seeing the same in Southwest Florida as slow sales continue a buyer’s market. According to the report, September marks the first time in 29 months that pending home sales weren’t above year-ago levels.
Nationally, the Pending Home Sales Index (PHSI), a forward-looking indicator based on contract signings, fell 5.6 percent in September from August. Year-over-year, the index is down 1.2 percent compared to September 2012.
“Declining housing affordability conditions are likely responsible for the bulk of reduced contract activity,” says Lawrence Yun, NAR chief economist. “In addition, government and contract workers were on the sidelines with growing insecurity over lawmakers’ inability to agree on a budget. A broader hit on consumer confidence from general uncertainty also curbs major expenditures such as home purchases. This tells us to expect lower home sales for the fourth quarter, with a flat trend going into 2014. Even so, ongoing inventory shortages will continue to lift home prices, though at a slower single-digit growth rate next year.”
NAR projects that total existing-home sales this year will be 10 percent higher than 2012, reaching more than 5.1 million, and will likely hold even in 2014. The national median existing-home price is expected to rise 11 to 11.5 percent for all of 2013, but moderate to a 5 to 6 percent gain in 2014.
Information fro a report, © 2013 Florida Realtors®, Oct 28, 2013.