Pending home sales increased 4.8% in June compared with May but were down 2.6% compared with June 2023, according to the National Association of Realtors (NAR).
Month-over-month, contract signings increased in all four U.S. regions.
Year-over-year, pending home sales declined in the Northeast, Midwest and South, but were up in the West.
“The rise in housing inventory is beginning to lead to more contract signings,” says Lawrence Yun, chief economist for NAR, in a statement. “Multiple offers are less intense, and buyers are in a more favorable position.”
For the month of June, pending home sales increased 3.0% in the Northeast; 4.7% in the Midwest; 6.3% in the South; and 3.4% in the West.
“Even more inventory is expected to come onto the housing market in the upcoming months ahead of the normal, seasonal declines in the winter,” Yun adds. “The Northeast’s small gain in contract signings is due to the ongoing housing shortage situation in that region, leading to stronger home price gains. It is a good time to list.”
Helping to boost contract signings is increasing homebuyer confidence.
In a separate statement, Selma Hepp, chief economist for CoreLogic, says ”We are witnessing an important shift in home buying sentiment.”
“This time last year, potential homebuyers had the mentality to get into home buying despite high rates and a lack of homes for sale,” Hepp says. “With little expectation of interest rates going down in the near term, the mindset today is to wait and see. Households are taking the headlines in and see rising insurance costs and climate change disruptions contributing to the affordability challenges, and that is also having a negative impact on sentiment.”
Photo: Gabrielle Henderson