Pending Home Sales Yet Another Sign Of A Recovery
September 18th, 2009 categories: Economic Recovery, FSBO's, For Buyers, For Homeowners, For Sellers, Housing Market
Even the most pessimistic of analysts have to admit now that the evidence of a housing recovery is piling up.
Earlier this month, the National Association of REALTORS® reported that the number of pending home sales rose again in July. This marks the sixth straight month that this figure has risen.
That’s significant because it’s a record. This is the first time this figure has risen for so many consecutive months since the REALTORS® association first began tracking pending home sales in 2001.
The pending home sales index is a bit complicated. It’s based on sales contracts signed each month. In July, then, the number of housing contracts that consumers signed rose again. This, of course, is a good sign that the housing market is regaining its strength.
Lawrence Yun, the chief economist for the National Association of REALTORS®, said that the housing recovery is now gaining momentum across the country. We’ve seen signs of it here, too, in Chicago, as housing sales in the city continue to rise month after month. At the same time, the prices of condominiums and single-family homes in Chicago are slowly, but steadily, rising again.
Yun points to first-time homebuyers as one of the main catalysts for the current recovery. The REALTORS® association estimates that from 1.8 million to 2 million first-time buyers will take advantage of the federal government’s $8,000 first-time homebuyer tax credit this year. The association also says that about 350,000 home sales that will take place this year would not have happened without the tax credit.
Chalk up the increase in pending home sales as yet one more sign that the housing market is in the midst of a much-awaited recovery. Remember, as the housing market regains its strength, it will exert a positive influence on the rest of the economy. A strong housing market usually equals a strong economy, too.
