Pending-home sales increased for the second-consecutive month in September, as the National Association of Realtors says the Pending Home Sales Index (PHSI) rose 1.5% for the month and year-over-year contract signings jumped 3.9%.
“Even though home prices are rising faster than income, national buying power has increased by 6% because of better interest rates,” said National Association of Realtors’ Chief Economic Lawrence Yun. “Furthermore, we’ve seen increased foot traffic as more buyers are evidently eager searching to become homeowners.”
Yun said the markets such as Fort Wayne, Indiana; Rochester, New York; Pueblo, Colorado; Columbus, Ohio; and Topeka, Kansas saw the largest increases in active listings in September compared to last year.
However, Yun said the numbers would have been better if more housing was available.
“Going forward, interest rates will surely not decline in a sizable way, so the changes in the median price will be the key to housing affordability,” he said. “But home prices are rising too fast because of insufficient inventory.”
The regional indices were mixed in September, with the Northeast experiencing the smallest change of the four regions. The Northeast’s PSHI fell 0.4% for the month, but remains 1.3% higher than a year ago. The index in the Midwest grew 3.1$ in September.
An increase of 2.6% was reported for the South, but the West posted a 1.3% decline in September, but remains 3.4% higher than a year ago.
Both the First American Financial Corporation and CoreLogic released information Tuesday that showed home prices have fallen. The First American Real House Price Index reported home prices fell 5.9%.
CoreLogic’s Case-Shiller Indices revealed the biggest annual gains in home prices were in Phoenix, Charlotte, and Tampa.
Home prices decreased 1.3% between July 2019 and August 2019, according to the latest First American Real House Price Index (RHPI), while year over year, real house prices declined 5.9%.
“The U.S. National Home Price NSA Index trend remained intact with a year-over-year price change of 3.2%” says Philip Murphy, Managing Director and Global Head of Index Governance at S&P Dow Jones Indices. “However, a shift in regional leadership may be underway beneath the headline national index.”