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Economy in Brief

U.S. Pending Home Sales Rebound
by Tom Moeller  March 28, 2016

The National Association of Realtors (NAR) reported that pending sales of single-family homes rose 3.5% in February (0.7% y/y) and recovered January's 3.0% decline, initially reported as -2.5%. The February sales volume was 1.9% below the peak last April. Expectations, according to a Wall Street Journal survey, were for an increase of 1.2%. These sales are reported as an index with 2001=100. The February value of 109.1 was 41.5% higher than the June 2010 low.

Regionally, February sales performance varied greatly around the country. Sales in the Midwest rebounded 11.4% after a 4.9% decline. In the South, sales gained 2.1% following a 0.7% dip. Sales in the West nudged 0.7% higher after a 5.2% decline. In the Northeast, sales eased 0.2% on top of a 3.5% decline.

The pending home sales figures are analogous to the new home sales data from the Census Bureau. 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) Feb Jan Dec Feb Y/Y 2015 2014 2013
Total 3.5 -3.0 0.9 0.7 7.5 -3.3 4.6
Northeast -0.2 -3.5 5.9 12.6 8.0 -0.4 6.2
Midwest 11.4 -4.9 0.3 2.5 6.8 -5.7 10.5
South 2.1 -0.7 0.3 -0.4 6.5 -1.4 5.5
West 0.7 -5.2 -1.0 -6.2 10.0 -5.9 -3.8
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