Everyone loves a good comeback. In January, the Cleveland Cavaliers rebounded from a 3-1 finals performance to clinch the top spot in the NBA. In a week, the Chicago Cubs may complete one of the greatest comebacks ever by winning the World Series for the first time since 1908.
And, according to the National Association of Realtors’ latest Pending Home Sales Index, the housing market may be at the beginning of a Cinderella story of its own.
“Buyer demand is holding up impressively well this fall with Realtors reporting much stronger foot traffic compared to a year ago,” said NAR chief economist Lawrence Yun.
“Although depressed inventory levels are keeping home prices elevated in most of the country, steady job gains and growing evidence that wages are finally starting to tick up are encouraging more households to consider buying a home.”
September’s index reading climbed to 110.0 from a downwardly revised 108.4 in August — the lowest index of the year and the eighth consecutive month of dipping numbers.
The PHSI in the Northeast fell to 96.5 but is still 7.7 percent above a year ago. In the Midwest, the index declined to 104.6, and is now 1.0 percent lower than September 2015.
Pending home sales in the South rose to an index of 122.1 — a 1.9 percent month-over-month and 1.7 percent year-over-year increase. The West outshone all the other regions with an impressive increase to 107.3 — a 4.7 percent month-over-month and 4.0 percent year-over-year increase.
Although the Northeast and Midwest fell behind in September, Yun says the South and West’s impressive numbers will be enough to “outgain declines.”
NAR uses a large national sample of signed residential property sale contracts to build its monthly pending home sales index. The sample size typically represents about 20 percent of transactions for existing-home sales. The index level was benchmarked to 100 in 2001, which was the first year to be examined. Existing-home sales in 2001 were in the 5 million to 5.5 million range, which is considered normal for the population in the U.S.