Pending home sales declined in October, but have remained at a healthy pace for six straight months. They’re also above year-over-year levels for the second straight month, according to the NATIONAL ASSOCIATION OF REALTORS®.
The Pending Home Sales Index counts the number of signed real estate contracts for existing single-family homes, condos, and co-ops.
Reasons for the healthy pace of signed contracts, according to Lawrence Yun, NAR chief economist, include:
- Low interest rates
- More homes for sale
- Less competition from investors paying in cash
“Demand is holding steady but would be more robust if it weren’t for lagging wage growth and tight credit conditions that continue to hamper those individuals looking for relief from rising rents,” he said.
Pending Home Sales by Region
|October 2014||vs. October 2013|
|National||Down 1.1%||Up 2.2%|
|Northeast||Up 0.5%||Up 3.4%|
|Midwest||Down 0.6%||Down 3.0%|
|South||Down 1.0%||Up 3.9%|
|West||Down 3.2%||Up 4.1%|
Median Home Price
The median existing-home price for all housing types in October was $208,300, which is 5.5% above October 2013. Monthly median price growth has averaged 5.8% in 2014 (through October) after averaging 11.5% last year.
“The increase in median prices for existing-homes has leveled off, representing a healthier pace that has kept affordability in check for buyers in many parts of the country while giving more previously stuck homeowners with little or no equity the ability to sell,” said Yun.
The typical seller has been in his home for 10 years before selling — an all-time high, according to a recent NAR survey.
2015 and 2016 Housing Forecast
Yun is forecasting that existing-home sales this year will fall slightly below 2013 (5.1 million) to 4.9 million, and then increase to 5.3 million next year and 5.4 million in 2016. He expects the national median existing-home price to rise 4% both next year and in 2016.