Economist's Insights

Pending Home Sales Point to More Melancholy Housing Activity

Aug 31, 2017

The July pending home sales report showed a 0.8% pullback in new contract signings compared with expectations for a half-percentage point gain. Adding to the disappointment, the initial estimate of a 1.5% increase in June was revised down to 1.3%. Looking at the regional results, sales were softer across the board and the three of the four regions reported MoM declines. The NAR’s chief economist said about the data, “Buyer traffic continues to be higher than a year ago, the typical listing has gone under contract within a month since April, and inventory at the end of July was 9 percent lower than last July.” The resultant higher prices are keeping a lid on buying as affordability remains a headwind. He added, “The reality, therefore, is that sales in coming months will not break out unless supply miraculously improves.”