The rate of pending home sales fell 13.6 percent in September compared to the same month in 2005, according to a report by the National Association of Realtors, and was down 1.1 percent compared to August 2005.
The Pending Home Sales Index, derived from pending sales of existing homes, fell to 109.1 in September — the lowest level so far this year.
A sale is listed as pending when the contract has been signed and the transaction has not closed, the association noted, and pending sales typically are finalized within one or two months of signing.
The index is based on a large national sample that typically represents about 20 percent of transactions for existing-home sales. In developing the model for the index, the association demonstrated that the level of monthly sales-contract activity from 2001 through 2004 parallels the level of closed existing-home sales in the following two months.
An index of 100 is equal to the average level of contract activity during 2001, the first year to be examined and the first of five consecutive record years for existing-home sales.
Regionally, the index rose 2.1 percent in the Midwest in September to 96.4 but was 18.4 percent below September 2005. The index in the West dropped 0.4 percent to 112.5 in September and was 15.2 percent below a year ago. In the South, the index slid 1.3 percent in September to 125 and was 9 percent below September 2005. The index in the Northeast fell 5.9 percent to 89.9 in September and was 15.9 percent lower than a year earlier, the association reported.
David Lereah, NAR’s chief economist, said in a statement, “The present level of home sales is relatively high in historic terms, and we can expect generally minor movements around this level. We don’t expect to see any changes of note until early next year when we’re likely to see a modest lift to home sales,” he said. “The market currently is a little lower than expected as buyers try to time their entry.”