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Economy in Brief

U.S. Pending Home Sales Increase
by Tom Moeller  January 31, 2018

The National Association of Realtors (NAR) reported that pending home sales increased 0.5% (0.5% y/y) during December to an index level of 110.1 (2001=100). This followed a 0.5% November increase, moving the index to the highest level in nine months. Nevertheless, sales remained 3.1% below their recent peak in April 2016.

Sales changes were mixed by region. Sales in the South increased 2.6% (4.0% y/y) to the highest level since March. In the West, sales gained 1.5% (-3.1% y/y), but have trended sideways for six months. To the downside were sales in the Northeast which posted a 5.1% decline (-2.7% y/y), and remained 8.0% below the February peak. Sales in the Midwest eased 0.3% (+0.3% y/y) and also have trended erratically sideways since the middle of 2016.

The pending home sales index measures home sales when the sales contract is signed, analogous to the Census Bureau's new home sales data. In contrast, the National Association of Realtors' existing home sales data are recorded when the sale is closed. In developing the pending home sales index, the NAR found 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, 2001=100) Dec Nov Oct Dec Y/Y % 2017 2016 2015
Total 110.1 109.6 109.3 0.5 109.0 109.8 108.8
Northeast 93.9 98.9 95.0 -2.7 97.1 96.3 90.7
Midwest 105.0 105.3 105.4 0.3 104.7 107.3 107.1
South 126.9 123.7 123.6 4.0 123.7 122.8 123.0
West 101.7 100.2 102.2 -3.1 99.7 102.5 102.4
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