Pending Home Sales Index Points To Easing Market
WASHINGTON (September 1, 2006) – Home sales should be leveling out in the months ahead at a lower pace, according to an index based on pending home sales, a leading indicator for the housing market published by the National Association of Realtors®.
The Pending Home Sales Index,* based on contracts signed in July, is down 7.0 percent to a level of 105.6 from a downwardly revised reading of 113.5 in June, and is 16.0 percent lower than July 2005.
This shouldn't be a surprise to anyone. It's been obvioius for some time now that the real estate market is slowing. We continue to believe that while real estate will slow down, it will not crater because mortgage rates are also falling and the economy continues to add jobs. We also note that while the declines seem severe, sales are falling from a very high level.