March Home Sales Rise – The National Association of Realtors (NAR) released their Pending Home Sales Report for March showing that pending home sales improved notably with the seasonally adjusted national index climbing 4.1% since February while increasing 12.8% above the level seen in March 2011.
Meanwhile, the NARs chief economist Lawrence Yun suggests that, based on the current trends, 2012 could see the best selling in five years.
“The spring home buying season looks bright because of an elevated level of contract offers so far this year, … If activity is sustained near present levels, existing-home sales will see their best performance in five years. Based on all of the factors in the current market, that’s what we’re expecting with sales rising 7 to 10 percent in 2012.”
The problem is though, the MBA Purchase Index is not currently capturing any significant rise in purchase contract activity which begs the question… how are the buyers that the NAR sees in the pending index financing their purchase? … Cash?
The above chart shows the seasonally adjusted national pending home sales index along with the percent change on a year-over-year basis as well as the percent change from the peak set in 2005.
Pending home sales are considered a leading indicator of progress in real estate because they track contract signings. Purchases of existing homes are tabulated when a contract closes, typically a month or two later, and made up about 93 percent of the housing market last year.
Two of four regions saw an increase in pending home sales from the prior month, led by an 8.7 percent jump in the West, today’s report showed, while the South posted a 5.9 percent gain.