A Bit of Good News for the Housing Market – Charlotte NC Real Estate Expert

According to the National Association of Realtors® (NAR), pending home sales have risen for nine consecutive months, up nearly 4%. 

Although some deals can and will fall through the wayside, signed contracts are a good forward-indicator of where the housing market is headed. October definitely showed signs of optimism and any trends pointing to housing market recovery are the kind we all like to see.

 Dr. Lawrence Yun, chief economist for the National Association of Realtors says the expanded home owners tax credit, affordable prices and super low interest rates (30 year fixed-rates at 4.8 percent on average last week and 15 year rates below 4.3 have made it easier for people to buy a home.

Increase in Pending Home Sales

NAR’s Pending Home Sales Index (PHSI) is a leading indicator of housing contract activity nationwide and is released during the first week of each month. The PHSI is based on signed real estate contracts for existing single-family homes, condos and co-ops. The PHSI looks at the monthly relationship between existing-home sale contracts and transaction closings over the last 4 years and is a key indicator of where the housing market is headed over the next coming months. 

The PHSI revealed an increase of 3.7%  in October, which is 31.8% above the month of October in 2008.  According to the Mortgage Bankers Association, it is the biggest annual increase since the inception of the PHSI in 1970.

Nationwide Pending Home Sales for October 2009

According to the Pending Home sale Index for October 2008 there were increases across the board except for the West.

• Northeast – Rose 19.9% percent and is up 44.2% since October 2008.
• Midwest – Rose 11.6% and is up 36.6% since October 2008.
• South – Rose 5.4% and is up 31.6 % since October 2008.
• West – Fell 11.2 percent, but is 21.9% up since October 2008.

Yun says that the increase in home sales in most parts of the nation are starting to make a real dent in inventories that have been sitting on the market. 

However, according to Yun “Based on the demographics of our growing population, existing-home sales should be in the range of 5.5 million to 6.0 million annually, but we were well below the 5-million mark before the home buyer tax credit stimulus.

Yun gives much of the credit for increased home sales to the home buyers tax credit, which home buyers can use to reduce their taxes up to $8000 and cautions that home sales could fall again in the coming months. “The expanded tax credit has only been available for the past three weeks, but the time between when buyers start looking at homes until they close on a sale can take anywhere from three to five months” says Yun.

 “We could see a temporary decline in closed existing-home sales from December until early spring when we get another surge, but the weak job market remains a major concern and could slow the recovery process.”

Despite the rise in unemployment and foreclosures holding back our nations economic recovery, the increase in pending home sales shows signs that the housing market is growing stronger. Existing-home sales for November will be reported December 22 and the next Pending Home Sales Index will be released on January 5th.

Charlotte North Carolina Homes For Sale

If you are in the market to buy a home in Charlotte North Carolina, contact Leigh Brown, leading real estate expert of the Charlotte Metro area. Leigh has years of experience assisting clients purchase property in the Charlotte, NC area with a proven track record of success. You can reach Leigh by filling out her online contact form on by calling her at (704) 688-5005 or toll free at (866) 440-7136.

Sources:

NAR
CNNMoney.com
RealtyTimes