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Economy in Brief

U.S. Pending Home Sales Decline Further
by Tom Moeller  August 28, 2013

The National Association of Realtors (NAR) reported that pending sales of single-family homes during July declined 1.3% m/m but remained up 6.7% versus July of last year. The monthly decline followed an unrevised 0.4% June slip. Despite the shortfall, sales remained at nearly the highest level since May 2006. The rebound in sales since the removal in 2010 of the home buyers tax credit has raised home sales by 43.8% from the low.

Last month's sales decline again reflected mixed performance around the country. Home sales in the Northeast fell 6.5% (+3.3% y/y) while sales in the West dropped 4.9% (-0.4% y/y). Also moving 1.0% lower were home sales in the Midwest but they remained up 14.6% y/y. Pending home sales in the South rose 2.6% (7.7% y/y). 

Pending home sales figures are analogous to the new home sales data from the Commerce Department. They measure existing home sales when the sales contract is signed, not at the time the sale is closed. In developing the model for the index, the NAR demonstrated that the level of monthly sales-contract activity parallels the level of closed existing-home sales in the following two months. The series dates back to 2001 and the data are available in Haver's PREALTOR database. 

The Cottage Industry Goes Big: Institutional Investors Flock To Single-Family Homes from the Federal Reserve Bank of Atlanta can be found here.

Pending Home Sales (2001=100) Jul Jun May Y/Y % 2012 2011 2010
Total 109.5 110.9 111.3 6.7 100.3 90.2 89.1
Northeast 81.5 87.2 87.2 3.3 79.1 67.9 70.9
Midwest 113.2 114.3 115.5 14.6 95.9 81.5 79.8
South 121.5 118.4 120.8 7.7 110.7 98.3 97.0
West 108.6 114.2 110.5 -0.4 105.2 104.1 100.7
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