Pending home sales rose 3.6 percent from May to June, marking five consecutive months of gains for the first time since July 2003, the National Association of Realtors said.

The gains were spurred by low interest rates and affordable home prices, and were strongest in the South (7.1 percent) and West (2.9 percent), NAR said. Month-over month gains in NAR’s pending home sales index were more modest in the Midwest (0.8 percent) and Northeast (0.4 percent).

Looking back a year, the index was up 11.6 percent in the Midwest, 8.9 percent in the South, and 5.8 percent in the Northeast. In the West, however, NAR’s pending home sales index was down 0.2 percent from a year ago.

A monthly rise in home prices and somewhat higher mortgage interest rates led to a "modest decline" in affordability in June, NAR said, but another index measuring affordability "remains very favorable."

Although the median existing single-family home price in June was $181,600, a family earning the median income of $60,700 could afford a home costing $289,100 with a 20 percent down payment and 25 percent of their gross income devoted to mortgage payments.

NAR has complained that recent increases in the pending home sales index have not been providing all of the expected boost in closed transactions in subsequent months, in part because appraisals often come in under the contracted sales price.

The group has blamed the situation on new rules for appraisals conducted on loans slated for purchase or guarantee by Fannie Mae and Freddie Mac, and called for their suspension.

Fannie and Freddie’s regulator, the Federal Housing Finance Agency, and many appraisers and appraisal management companies, say market forces, not the new rules, are more often the reason valuations come in below the contracted sales price (see story).


What’s your opinion? Leave your comments below or send a letter to the editor.

Show Comments Hide Comments


Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
Thank you for subscribing to Morning Headlines.
Back to top
We're giving away 3 free ICLV tickets at Connect Now next week. Register and attend live for your chance to win!REGISTER×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription