Pending Home Sales Inched Up In September

After falling 1.0% the month prior, pending home sales increased 0.3% in September compared to August and were up 1.0% compared to September 2013, according to the National Association of Realtors (NAR).

Regionally, pending home sales increased 1.4% in the South and 1.2% in the Northeast, but fell 1.2% in the Midwest and 0.8% in the West.

Lawrence Yun, chief economist for NAR, says moderating price appreciation and improved inventory levels are keeping conditions favorable for buyers.

‘Housing supply for existing homes was up in September six percent from a year ago, which is preventing prices from rising at the accelerated clip seen earlier this year,’ Yun says. ‘Additionally, the current spectacularly low mortgage rates should help more buyers reach the market.’

Despite increased inventory and low interest rates, tight credit conditions continue to be a barrier for some buyers. About 15% of Realtors in September reported having clients who could not obtain financing as the reason for not closing.

Yun says the final Qualified Residential Mortgage rule approved by regulators last week should improve access to credit once it goes into effect next year.

‘The rule provides clarity for lenders and is a win for creditworthy consumers by ensuring they continue to have access to safe and affordable loan products without overly burdensome down-payment requirements,’ Yun says.

Last week, NAR reported that existing-home sales – including sales of condominiums and town houses – increased from a seasonally adjusted annual rate of 5.17 million in September, up 2.4% compared to the 5.05 million home sales recorded in August.

Although existing home sales in September reached their highest pace so far this year, they remained 1.7% below the 5.26 million units sold in September 2013.

The median existing-home price for all housing types in September was $209,700, an increase of 5.6% compared to September 2013, according to NAR.


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