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Economy in Brief

U.S. Pending Home Sales Down Slightly
by Carol Stone, CBE  November 27, 2019

U.S. pending home sales decreased 1.7% (+4.4% y/y) in October, according to the National Association of Realtors (NAR). This followed a 1.4% increase in September, which was revised from 1.5%. The October index level of sales was 106.7 (2001=100).

Sales fell in three regions of the country in October. The exception was the Northeast, where they rose 1.9% (+3.0% y/y) after easing 0.4% in September. Otherwise, the biggest decline was in the West, 3.4% (+7.5% y/y) in October, which followed a 1.4% fall in September. Sales in the Midwest were down 2.7% (+1.8% y/y) in October, reversing a 2.9% gain the month before. And in the South, they fell 1.7% (+5.1% y/y) after increasing 2.6% in September.

The pending home sales index measures sales at the time the contract for the sale of an existing home 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, which is a month or two later. Accordingly, in developing the pending home sales index, the NAR found that the level of monthly sales contract activity precedes the level of closed existing home sales by one to two months. The series dates back to 2001, and the data are available in Haver's PREALTOR database. Mortgage interest rates from the Mortgage Bankers Association can be found in the SURVEYW database.

Pending Home Sales (SA, 2001=100) Oct Sep Aug Oct Y/Y % 2018 2017 2016
Total 106.7 108.6 107.1 4.4 104.7 109.1 109.8
   Northeast 95.7 93.9 94.3 3.0 92.4 97.1 96.4
   Midwest 101.4 104.2 101.3 1.8 100.2 104.9 107.4
   South 125.3 127.5 124.3 5.1 121.6 123.9 123.0
   West 91.9 95.1 96.4 7.5 92.3 99.5 102.3
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