Real Estate Marketing & Beyond
The National Association of Realtors has just published its latest housing report, showing that pending home sales fell slightly in November. However, the NAR says a reversal is within sight and that it is optimistic about the state of housing in 2019.
The NAR’s Pending Home Sales Index is often seen as an important forward-looking indicator into the state of the market. The Index fell by 0.7 percent to 101.4 in November 2018, with contract signings down 7.7 percent compared to the previous year.
Still, NAR Chief Economist Lawrence Yun said there’s no reason to be concerned.
“The latest decline in contract signings implies more short-term pullback in the housing sector and does not yet capture the impact of recent favorable conditions of mortgage rates,” he insisted.
Freddie Mac reported another drop in mortgage rates last week. The 30-year fixed-rate mortgage averaged 4.55 percent, with an average 0.5 points.
Yun says that pending contracts have reached their lowest mark since 2014, but he still predicts solid growth over the long term in the housing market.
He noted that more inventory is coming to the market as more homeowners put their home up for sale. The markets seeing the largest year-over-year increases in inventories are: Denver-Aurora-Lakewood, Colo.; Seattle-Tacoma-Bellevue, Wash.; San Francisco-Oakland-Hayward, Calif.; San Diego-Carlsbad, Calif.; and Providence-Warwick, R.I.
Overall, the housing industry looks to close out the year with 5.3 million home sales, which is similar to the year 2000.
“But given the 17 million more jobs now compared to the turn of the century, the home sales are clearly underperforming today,” Yun said. “That also means there is steady longer-term growth potential.”
