The National Association of Realtors developed the pending home sales index as a leading indicator of housing activity. As such, it is a leading indicator of existing home sales, not new home sales. A pending sale is one in which a contract was signed, but not yet closed. It usually takes four to six weeks to close a contracted sale. Why Investors Care
| Released on 11/7/08 For Sep 2008 | |||||||||||||||||||||
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Highlights
Pending home sales fell back in September, down 4.6 percent and reversing some of August's big gain of 7.5 percent (+7.4 percent initially reported). The index level of 89.2 is still above July's 87.0 and compares favorably with 87.8 in September 2007. Home sales have been down for so long and so deeply that longer term comparisons are very easy, an indication hinting, but only hinting, that conditions in the sector are bottoming or at least can't get much worse. The drop in September was centered in the Northeast and South with the West showing by far the best activity. Today's results unfortunately suggest that one month of improvement in existing and new home sales may in fact prove to be just one month of improvement. Existing and new home sales data for October will be posted at month end. There was no reaction to the results.
The pending home sales index surged 7.4 percent in August for a year-on-year gain of 8.8 percent. Lower home prices finally may be attracting buyers. But with unemployment rising, the question is which the August improvement in sales will continue.
Pending home sales Consensus Forecast for September 08: 90.6
Range: 87.8 to 92.0
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