Inventory and affordability constraints, along with uneven regional numbers, hampered what was supposed to have been a boost to mortgage activity in June, leaving pending home sales slightly up but essentially flat for the month in the last pending home sales report released in late July.
The industry will find out how pending home sales fared in July when that month’s report is published on the morning of Wednesday, August 31.
June’s Pending Home Sales Index from the National Association of Realtors (NAR) reported that, based on contract signings, pending home sales inched up 0.2 percent to 111 in June. This also is 1 percent higher than June 2015, but is noticeably down from this year's peak level in April, 115. June, however, was the second-highest reading in a year.
“With only the Northeast region having an adequate supply of homes for sale, the reoccurring dilemma of strained supply causing a run-up in home prices continues to play out in several markets, leading to the last two months reflecting a slight, early summer cooldown after a very active spring,” said Lawrence Yun, NAR chief economist. “Unfortunately for prospective buyers trying to take advantage of exceptionally low mortgage rates, housing inventory at the end of last month was down almost 6 percent from a year ago, and home prices are showing little evidence of slowing to a healthier pace that more closely mirrors wage and income growth.”
Employment Situation for August 2016, Bureau of Labor Statistics, Friday, September 2, 8:30 a.m. EST
The industry will be watching closely for what will be the last employment situation from the BLS before the next Federal Open Market Committee meeting on September 20-21. Job gains in June and July were solid after May’s disappointment; even with the May report calculated in, job gains still averaged 190,000 over the three-month period from May to July.
“Indeed, in light of the continued solid performance of the labor market and our outlook for economic activity and inflation, I believe the case for an increase in the federal funds rate has strengthened in recent months,” Yellen said in a speech in Jackson Hole on Friday. “Of course, our decisions always depend on the degree to which incoming data continues to confirm the Committee's outlook.”
This week’s schedule
Tuesday, August 30
S&P CoreLogic Case Shiller Home Price Index for June 2016, 9 a.m EST
Consumer Confidence for August 2016, the Conference Board, 10 a.m. EST
Wednesday, August 31
Pending Home Sales Index for July 2016, National Association of Realtors, 10 a.m. EST
Friday, September 2
Employment Situation for August 2016, Bureau of Labor Statistics, 8:30 a.m. EST