Today, the National Association of Realtors (NAR) released their Pending Home Sales Report for July showing home sales declined with the seasonally adjusted national index dropping 1.3% since June but increasing 14.4% above the level seen in July 2010.
Meanwhile, the NARs chief economist Lawrence Yun suggests that conditions for buying should improve given that buyers can use real estate as an inflation hedge... only catch, that's assuming that home prices stop deflating! In both nominal and real terms home prices are still falling considerably.
"The underlying factors for improving sales are developing, such as rising rents, record high affordability conditions and investors buying real estate as a future inflation hedge. It is now a question of lending standards and consumers having the necessary confidence to enter the market."
The following chart shows the seasonally adjusted 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).