Economist's Insights

Rebound in the South Boosts Overall Pending Home Sales in October

Nov 29, 2017

Pending home sales rose a stronger-than-expected 3.5% in October and, despite some geographical diversity in the gains, a rebound in activity in the South was a major reason for the positive result (see Chart 1). Weakness in the data was widespread in August and activity in the South remained sluggish in September because of the hurricanes, even as other regions experienced a recovery. A return to normalcy in October boosted contract signings in the South by 7.4%. Elsewhere, pending sales in the Midwest rose 2.8% and activity in the Northeast edged up 0.5% while contract signings in the West dipped 0.7%. The Chief Economist for the National Association of Realtors, the group responsible for compiling the pending sales data, said about the report that “Home shoppers had better luck finding a home to buy in October, but slim pickings and consistently fast price gains continue to frustrate and prevent too many would-be buyers from reaching the market.” In the October existing sales report released a week ago, inventories fell on a YoY basis for a 29th consecutive month and the months of supply dropped to its lowest level for an October on records reaching back to 1999 (see Chart 2).