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Economy in Brief

U.S. Pending Home Sales Hit By Winter Storms
by Tom Moeller  January 30, 2014

The National Association of Realtors (NAR) reported that December pending sales of single-family homes plunged 8.7% m/m following a 0.3% slip in November, revised from a 0.2 rise. It was the seventh consecutive month of decline. Nevertheless, home sales or all of last year increased 4.4% following increases of 11.2% and 1.3% in the prior two years.

Home sales fell hard across the country last month. In the Northeast a 10.3% decline (-5.5% y/y) was logged but strength earlier in the year lifted the full year average by 6.2%. Sales out West declined 9.8% (-16.0% y/y) and for the full year fell 4.1%. Sales down South posted an 8.8% (-6.9 y/y) falloff but for all of 2013 were up 5.4%. In the Midwest, December sales were off 6.8% (6.9% y/y) yet surged 10.4% for the year.

The pending home sales figures are analogous to the new home sales data from the Commerce Department. They measure 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.

Pending Home Sales (2001=100) Dec Nov Oct Y/Y % 2013 2012 2011
Total 92.4 101.2 101.5 -8.8 104.8 100.3 90.2
Northeast 74.1 82.6 84.9 -5.5 84.0 79.1 67.9
Midwest 93.6 100.4 103.8 -6.9 105.9 95.9 81.5
South 104.9 115.0 113.5 -6.9 116.7 110.7 98.3
West 85.7 95.0 93.3 -16.0 100.9 105.2 104.1
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