Pending US Home Sales Rose in July, Realtors Say

(CN) – More people signed contracts to purchase homes in July, a sign that the demand for homes remains strong despite a shortage of listings.
The National Association of Realtors said Wednesday that its seasonally adjusted pending home sales index rose 1.3 percent in July, reaching 111.3 – the highest reading since April.
Lawrence Yun, NAR chief economist, said a sizable jump in the West lifted pending home sales higher in July.
“Amidst tight inventory conditions that have lingered the entire summer, contract activity last month was able to pick up at least modestly in a majority of areas,” he said. “More home shoppers having success is good news for the housing market heading into the fall, but buyers still have few choices and little time before deciding to make an offer on a home available for sale. There’s little doubt there’d be more sales activity right now if there were more affordable listings on the market.”
“The index in the West last month was the highest in over three years 1 largely because of stronger labor market conditions. If homebuilding increases in the region to tame price growth and alleviate the ongoing affordability concerns, the healthy rate of job gains should support more sales,” Yun said.
The index’s regional snapshot showed the number of signed contracts rose in the Northeast, South and West, but dropped in the Midwest.
The good news comes at a time when the real estate listings are down 5.8 percent from August 2015 to 2.13 million. That’s putting pressure on buyers to pay more for the houses that are coming on the market.
Pending home sales contracts are considered a reliable indicator of future purchases. A sale is typically completed within 60 days of a contract is signed.

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