July saw a 5.5% decline in pending home sales, according to the National Association of REALTORS. Monthly transaction losses were reported for each of the four US regions. The Northeast had growth over the previous year, while the Midwest, South, and West saw decreases.
A forward-looking measure of home sales based on contract signings, the Pending Home Sales Index (PHSI) fell to 70.2 in July, the lowest level since the index’s inception in 2001. Pending transactions decreased by 8.5% over the previous year. The level of contract activity in 2001 is represented by an index of 100.
“A sales recovery did not occur in midsummer,” said NAR Chief Economist Lawrence Yun. “The positive impact of job growth and higher inventory could not overcome affordability challenges and some degree of wait-and-see related to the upcoming U.S. presidential election.”
The Northeast PHSI increased by 2.4% from July 2023 to 64.6, a 1.4% decrease from the previous month. In July, the Midwest index dropped 7.8% to 67.8, down 11.4% from the previous year.
In July, the South PHSI dropped 6.5% to 83.5, a decrease of 11.5% from the previous year. July saw a 3.8% decline in the West index, down 6.0% from July 2023 to 56.2.
“In terms of home sales and prices, the New England region has performed relatively better than other regions in recent months,” added Yun. “Current lower, falling mortgage rates will no doubt bring buyers into market.”
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