A Reliable Future Indicator for Housing
Good news, the Pending Home Sales Index rose slightly in December, climbing one percent over November’s numbers.
A Pending Home Sale is a home that is under contract to be sold, but not yet closed. It’s a figure compiled by the National Association of Realtors® using sales data from over 100 regional listing services and more than 60 large brokerages around the country.
Because each pending sale is a true measure of sales activity, the Pending Home Sales Index is purported to be the most reliable forward-looking indicator for housing statistics.
Recent information supports this statement.
After Pending Home Sales plunged sixteen percent in November, Existing Home Sales fell by seventeen percent in December. Based on the most recent Pending Sales Index, therefore, we can expect January’s closed sales to be similarly level.
Good News for Home Buyers
For home buyers in Urbandale , this is all a bit of good news. Home prices are based on the supply-and-demand balance that exists between buyers and sellers. When buyers outnumber sellers (like they did through most of 2009), home supplies dip and, in fact, the national home inventory nearly halved during the 12 months ending November 2009.
With fewer homes on the market, multiple-offer situations were almost commonplace and home values rose as result of all of the action.
Activity has since slowed, however, and fewer buyers are in today’s market. The supply-and-demand equation has shifted back some. In December, home supplies rose for the first time in 7 months and January will likely show the same.
The net result: Home buyers have more homes from which to choose and that can create negotiation leverage for better prices and better concessions.
With mortgage rates still low and a looming deadline on the homebuyer’s tax credit, market activity should be strong between now and April. Take your time and bid right. And when you’re ready, be ready. The best deals likely won’t last.
If you’re currently shopping for a home, I’d love to help. We can pre-approve you 24 hours a day, 7 days a week on my online application. Great advice has never been this easy to get!
