The National Association of Realtors has some surprisingly upbeat news for the real estate industry. It said that pending home sales, which are seen as a forward-looking indicator of the state of the housing market based on contract signings, jumped 2.4% in February compared to the previous month, and 9.4% year over year.
The spike is a sign that the real estate market is fundamentally still healthy, even as the coronavirus outbreak poses significant challenges to the U.S. economy as a whole.
The NAR said all four major regions of the country saw an increase in pending home sales last month. Downward pressure on those numbers is expected moving forward, as NAR's latest housing data reflects a time period before the nation began adopting social distancing measures to control the spread of COVID-19.
“February’s pending sales figures show the housing market had been very healthy prior to the coronavirus-induced shutdown,” said the NAR’s chief economist Lawrence Yun. “Numbers in the coming weeks will show just how hard the housing market was hit, but I am optimistic that the upcoming stimulus package will lessen the economic damage, and we may get a V-shaped robust recovery later in the year.”
What with all the social distancing measures in place due to the coronavirus, real estate professionals have tried to adapt to the situation by offering virtual tours of their listings, and using electronic signatures to close transactions without meeting face-to-face with clients.
“Many of the home sales that are likely to be missed during the first part of 2020 may simply be pushed into late summer and autumn,” Yun said.