After reaching a two-year peak, pending home sales fell in August, according to new data from the National Association of Realtors (NAR).
NAR's Pending Home Sales Index (PHSI) declined 2.6% to 99.2 in August from an upwardly revised 101.9 in July, but is 10.7% above August 2011 when it was 89.6. The NAR notes that contract activity in July 2012 was at the highest level since April 2010, when buyers were rushing to beat the deadline for the home buyer tax credit.
The PHSI in the Northeast rose 0.9% to 78.2 in August and is 19.9% above August 2011. In the Midwest, the index declined 2.6% to 95 in August but was 19.9% higher than a year ago. Pending home sales in the South slipped 1.1% to an index of 110.4 in August, and was 13.2% above August 2011. In the West, the index fell 7.2% in August to 102.5 and was 4.2% below a year ago.
‘The performance in month-to-month contract signings has been uneven with ongoing shortages of lower-priced inventory in much of the country and across most price ranges in the West, but activity has remained at notably higher levels this year,’ says Lawrence Yun, NAR's chief economist.