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The Week Ahead: A Deep Dive Into Pending Home Sales

pending home salesOn Wednesday, March 31 at 10:00 a.m. EDT, the National Association of Realtors (NAR) will release its Pending Home Sales Index (PHSI) for February 2021. The PHSI analyzes data on homes where the contract is signed, but not yet closed and is based on signed real estate contracts for existing single-family homes, condos, and co-ops. NAR’s PHSI is a key indicator of trends in the market.

NAR’s PHSI dropped 2.8% to 122.8 in January, and year-over-year, contract signings rose 13%. An index of 100 is equal to the level of contract activity in 2001.

"Pending home sales fell in January because there are simply not enough homes to match the demand on the market," said Lawrence Yun, NAR's Chief Economist. "That said, there has been an increase in permits and requests to build new homes."

As outlined by Yun, tight inventory resulted in a drop in sales, thus setting the table for heated bidding wars nationwide.

Regionally, the Northeast PHSI fell 7.4% to 101.6 in January; in the Midwest, the Index declined 0.9% to 113.2 last month; in the South, inched up 0.1% to an index of 151.3; and in the West, dropped 7.8% in January 2021, to 104.6.

Here's what else is happening in The Week Ahead:

About Author: Eric C. Peck

Eric C. Peck has 20-plus years’ experience covering the mortgage industry, he most recently served as Editor-in-Chief for The Mortgage Press and National Mortgage Professional Magazine. Peck graduated from the New York Institute of Technology where he received his B.A. in Communication Arts/Media. After graduating, he began his professional career with Videography Magazine before landing in the mortgage space. Peck has edited three published books and has served as Copy Editor for Entrepreneur.com.
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