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Economy in Brief

U.S. Pending Home Sales Improve to Highest Level Since 2006
by Tom Moeller  June 29, 2015

The National Association of Realtors (NAR) reported that pending sales of single-family homes increased 0.9% during May following a little revised 2.7% gain during April. The latest level was the highest since April 2006. Expectations were for a 1.0% increase according to Bloomberg. These sales are reported as an index with 2001=100. The May value was 112.6, up 46.0% from the 2010 low.

Movement in home sales varied greatly around the country during May. In the Northeast, sales increased 6.3% (12.0% y/y) to the highest level since October 2009. Sales in the West rose 2.2% (10.4% y/y) to the highest point since June 2013. Home sales eased 0.8% (+8.1% y/y) in the South and sales in the Midwest ticked 0.6% lower (+6.0% y/y).

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 (%, SA) May Apr Mar Y/Y 2014 2013 2012
Total 0.9 2.7 1.2 8.3 -4.4 5.0 11.8
Northeast 6.3 10.1 -1.5 9.4 - 1.4 7.0 17.6
Midwest -0.6 4.2 -2.4 6.0 -6.3 11.3 18.6
South -0.8 1.8 4.0 8.1 -2.0 6.0 12.9
West 2.2 -1.4 1.7 10.4 -8.7 -3.8 1.5
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