Pending Home Sales Dropped in September But Remain Up Compared to Last Year

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After rising for four consecutive months, pending home sales decreased in September, falling 2.2% compared with August to reach a score of 130.0 on the National Association of Realtors’ (NAR) Pending Home Sale Index.

Year-over-year, contract signings were up 20.5%.

Regionally, and month-over-month, pending home sales increased 2.0% in the Northeast, but decreased 3.2% in the Midwest, 3.0% in the South, and 2.6% in the West.

“The demand for home buying remains super strong, even with a slight monthly pullback in September, and we’re still likely to end the year with more homes sold overall in 2020 than in 2019,” says Lawrence Yun, chief economist for NAR, in a statement. “With persistent low mortgage rates and some degree of a continuing jobs recovery, more contract signings are expected in the near future.”

“Additionally, a second-order demand will steadily arise as homeowners who had not considered moving before the pandemic begin to enter the market,” Yun says. “A number of these owners are contemplating moving into larger homes in less densely populated areas in light of new-found work-from-home flexibility.”

NAR says recent data from realtor.com reveals that the housing market has recovered or even exceeded its previous January levels in numerous U.S. metros.

As of October 10, metros with the strongest recovery rates included Seattle-Tacoma-Bellevue, Wash.; Boston-Cambridge-Newton, Mass.-N.H.; Los Angeles-Long Beach-Anaheim, Calif.; Las Vegas-Henderson-Paradise, Nev.; and San Jose-Sunnyvale-Santa Clara, Calif.

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