Spring selling season volumes are the lowest since the housing bust.
By wolf richter For wolf street,
So you read the headlines today that pending home sales “unexpectedly” rose for the third month in a row, and that’s another sign that the housing market boom is back, LOL. So let’s add a grain of reality to these headlines.
The National Association of Realtors reported today that “pending sales” — “a forward-looking indicator of home sales based on contracts signed” — rose 0.8% in January to February to an index value of 83.2.
So wait… the index value was set at 100 for contract signing in 2001. Therefore today’s value of 83.2 is 16.9% below the 2001 index average. Wait more… Compared to the last three February, the index value of contract signing fell…
- up to 21% from February 2022
- Up to 25% from February 2021
- Up to 25% from February 2020.
The chart above (via Data YCharts) shows how small the increase was in January to February, and how large the decline was in previous periods.
Outside the lockdown April 2020, when the brokerage industry was essentially shut down, pending home sales since last August have been at the lowest level in several years.
Pending home sales by regionCompared to February a year ago (map via NAR):
The NAR defines a “pending sale” as a transaction where a contract was signed but it has not yet closed. At this point, the deal could still fall through for a number of reasons. If all goes well, NAR says the sale usually closes “within a month or two of signing.”
Actual Sales – Sales that closed in February, Reported last week by NAR – have gone through a Similar small increases in disappointing spring sales season so farRising above a deep-depressing hole during winter:
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