January’s Pending Home Sales Rose to its Highest Level in 18 Months!
Improved buyer demand after the New Year pushed 2015 Pending Home Sales in January to their highest level in 18 months (since August 2013), according to the National Association of REALTORS®.
The Association’s forward-looking pending home sales index climbed 1.7 percent to 104.2 in January from an upwardly revised 102.5 in December, 8.4 percent above January 2014.
Lawrence Yun, NAR chief economist, says for the most part buyers in January were able to overcome tight supply to sign contracts at a pace that highlights the underlying demand that exists in today’s market. “Contract activity is convincingly up compared to a year ago despite comparable inventory levels,” he said.
“The difference this year is the positive factors supporting stronger sales, such as slightly improving credit conditions, more jobs and slower price growth.”
Yun also points to more favorable conditions for traditional buyers entering the market. All-cash sales and sales to investors are both down from a year ago, creating less competition and some relief for buyers who still face the challenge of limited homes available for sale. “All indications point to modest sales gains as we head into the spring buying season,” says Yun. “However, the pace will greatly depend on how much upward pressure the impact of low inventory will have on home prices. Appreciation anywhere near double-digits isn’t healthy or sustainable in the current economic environment.”
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