Today, the National Association of Realtors (NAR) released their Pending Home Sales Report for September showing a 1.6% year-over-year rise in pending home sales nationally primarily fueled by a significant 39.5% year-over-year increase in foreclosure fueled west coast sales activity.Keep in mind that today’s results reflect pending sales that largely preceded the significant economic shocks experienced during September and October and that, as has been widely reported, many regions are experiencing significant numbers failed home purchases (buyer cannot secure financing) primarily as a result of more stringent lending standards.
As usual, NAR Senior Economist Laurence Yun continues his self-interested spin invoking the old 2006 line that the current results indicate that we are in a “broad period of stabilization”.
“The month-to-month weakening in pending home sales is understandable, but because the index remains above year-ago levels it means we’re still in a broad period of stabilization,”
The following chart shows the national pending homes sales index since 2005 compared monthly. Notice that each year, the months value is decreasing fairly consistently (click for larger version).
The following chart shows the national pending home sales index along with the percent change on a year-over-year basis as well as the percent change from the peak set in 2005 (click for larger version).
Note that in the above charts, I had to use the Not Seasonally Adjusted (NSA) data series as NAR changed the methodology for their Seasonally Adjusted (SA) series a while back and never republished the numbers.Look at September’s seasonally adjusted pending home sales results and draw your own conclusion:
- Nationally the index was up 1.6% as compared to September 2007.
- The Northeast region declined 9.4% as compared to September 2007.
- The Midwest region declined 3.1% as compared to September 2007.
- The South region was down 11.3% as compared to September 2007.
- The West region was up 39.5% as compared to September 2007.
