This email was sent to you by Daryl Hadd. View My Profile
Message:
Manage your Email Alerts - Once you're registered, you can manage all MND email alerts on one page, turning subscriptions on or off with one click. About MND:
Mortgage News Daily combines the expertise of some of the housing industry's leading minds with the power of social media to offer an always lively, constantly evolving web community. MND communicates breaking news, streams video, and provides expert opinion and commentary to a community of interested market professionals and curious consumers.
Pending Home Sales Confirm Increase in Buyer Demand Ahead of Tax Credit Expiration
Monday, April 05, 2010 1:42 PM
The National Association of Realtors released Pending Home Sales data today.
A sale is listed as "pending" when a contract to purchase an existing home has been signed but the transaction has not closed. The index is based on a large national sample, typically representing about 20 percent of transactions for existing-home sales. In developing the model for the index, it was demonstrated that the level of monthly pending home sales parallels the level of closed existing-home sales in the following two months.
From the release:
The Pending Home Sales Index, a forward-looking indicator based on contracts signed in February, rose 8.2 percent to 97.6 from a downwardly revised 90.2 in January, and remains 17.3 percent above February 2009 when it was 83.2. The data reflects contracts signed, not closings, which usually occur with a lag time of one or two months after the home sales contract is signed.
[Image or graph removed from email. View full article with images]
Regionally, the Midwest saw the biggest month over month uptick while the West extended its losing streak to five months.
- The Northeast rose 9.0 percent to 77.7 and is 18.9 percent higher than February 2009
- In the Midwest the index jumped 21.8 percent to 97.9 and is 18.7 percent above a year ago
- In the South increased 9.2 percent to an index of 107.0 and is 17.5 percent higher than February 2009.
- The West fell 4.8 percent to 98.0 but is 14.6 percent above a year ago.
[Image or graph removed from email. View full article with images]
Lawrence Yun, NAR chief economist says:
“Anecdotally, we’re hearing about a rise of activity in recent weeks with ongoing reports of multiple offers in more markets, so the March data could demonstrate additional improvement from buyers responding to the tax credit,”
I am hearing the same anecdotal evidence the NAR is receiving. READ MORE
The chart below illustrates how Pending Home Sales (contracts signed) are a forward looking indicator of Existing Home Sales. The 8.2 percent rise in contracts signed implies we should see a modest increase in Existing Home Sales in the months to come, as long as there are no "hiccups" in the loan qualifying process that is...
I should point out that the modest rise in mortgage rates which has occured over the past two weeks will push a portion of March's Existing Home Sales into April.
[Image or graph removed from email. View full article with images]
Yun adds:
“The rise in buyer contact activity may signal the early stages of a second surge of home sales this spring. The healthy gain hints home prices are continuing to flatten....We need a second surge to meaningfully draw down inventory and definitively stabilize home values.”
Plain and Simple: this is a key point in time for housing and the macroeconomic outlook. If housing is unable to gain recovery momentum before the tax credit expires, where will demand come from afterward?
READ MORE
(View More)
More from MND:
- Mortgage Rate Watch: Mortgage Rates Hold Near 2010 Highs After Jobs Data
- MND NewsWire: Pending Home Sales Confirm Increase in Buyer Demand Ahead of Tax Credit Expiration
- MBS Commentary: 3rd Lowest Trading Volume Since January As Rates Test Range Limits
- Community Commentary: Is The Reverse Mortgage Industry Strong Enough To Overcome Change?
- The Garrett Watts Report: Loan Approvals Before Delegated Underwriting; Repurchase Liability and the Value of a Mortgage Company; Flagstar Stock Dilution; Citi and TARP
If you have trouble viewing this email, you can read the full post at http://www.mortgagenewsdaily.com/04052010_february_pending_home_sales.asp
If you would like to opt-out of receiving email alerts from this person please click here to remove your email address.
No comments:
Post a Comment