The National Association of Realtors (NAR) released their pending home sales report for July recently. What it showed is that there has been positive signs for 3 consecutive months with respect to pending home sales with activity up in all regions with nationwide activity increasing 5.9% for the month. Activity is up month over month and year over year.
Pending home sales, which are when a contract has been signed but the transaction has not closed and the the sale usually is finalized within one or two months of signing are measured using an index named the Pending Home Sales Index (PHSI) by the NAR. An index score of 100 indicates the level of activity in 2001. The PHSI for July increased 5.9% to a level of 122.1. Contract signings for the year are up 15.5%.
Lawrence Yun, chief economist for the NAR states “We are witnessing a true V-shaped sales recovery as homebuyers continue their strong return to the housing market. Home sellers are seeing their homes go under contract in record time, with nine new contracts for every 10 new listings.” Activity doesn’t seem to be slowing down as the pandemic had the sector closed for many months and now are at least partially open in all markets. “Anecdotally, Realtors are telling me there is no shortage of clients or home seekers, but that scarce inventory remains a problem. If 20% more homes were on the market, we would have 20% more sales, because demand is that high” Yun said. The expectation is that housing starts are to average at 1.35 million in 2020 and to increase to 1.43 million in 2021.
Here is the breakdown per region:
Northeast: PHSI in the Northeast region increased significantly by 25.2% to 112.3 in July. This is a 20.6% upswing from July 2019.
South: The South saw their PHSI increase by 0.9% to an index of 142.0 in July. This is still an increase of 14.9% from the same time last year.
Midwest: The Midwest saw their index rise 3.3% to 114.6 last month. Overall this is a year over year jump of 15.4% from last year.
West: The West had an increase of 6.8% in July to 106.4. This is an increase of 13.2% from the same time last year.
BJD Property Management is a full service NYC property management company servicing the boroughs of Queens, Brooklyn, Manhattan and the Bronx. Whether it be a 1 bedroom condo or multi-family building we are able to assist our clients maximize their investments.