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Economy in Brief

U.S. Pending Home Sales Recover in May
by Tom Moeller  June 29, 2020

• Pending home sales rise to three-month high.

• Improvement spread throughout the country.

The National Association of Realtors (NAR) reported that pending home sales surged 44.3% during May to the highest level since February. Nevertheless, sales remained down 5.1% y/y.

Pending home sales improved across the country led by a 56.2% jump in the West (-2.5% y/y). In the Northeast, sales recovered 44.4% but remained one-third lower y/y. In the South, sales improved 43.3% (1.9% y/y) and they gained 37.2% (-1.4% y/y) in the Midwest.

The pending home sales index measures sales at the time the contract for 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. In developing the pending home sales index, the NAR found that the level of monthly sales contract activity anticipates 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. Mortgage interest rates from the Mortgage Bankers Association can be found in the SURVEYW database.

Pending Home Sales (SA, % chg) May Apr Mar May Y/Y % 2019 2018 2017
Total 44.3 -21.8 -20.8 -5.1 1.1 -4.1 -0.8
   Northeast 44.4 -48.2 -14.5 -33.2 0.8 -5.0 0.6
   Midwest 37.2 -15.9 -22.0 -1.4 -0.3 -4.6 -2.5
   South 43.3 -15.4 -19.6 1.9 1.8 -1.9 0.6
   West 56.2 -20.0 -26.8 -2.5 1.3 -7.3 -2.5
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