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Weehawken NJ
Washington, January 5, 2010 - Pending home sales pulled back in November marking the first time in nine months that the index failed to post gains.
Experts had anticipated a correction to 111.8 however the index declined below the expected number to pull down 16% from the from dOctober’s revised reading of 114.3.
The Northeast and Midwest bore the brunt of the decline posting 25.7% drops while sales fell by 15.0% in the South and 2.7% in the West.
Analysts point out that ven with this lower than anticipated performance the index is up 15% for the year( 2009).
National Association of Realtors chief economist, Lawrence Yun was cautious but optimistic stating that “It will be at least early spring before we see notable gains in sales activity as home buyers response to the recently extended and expanded tax credit. “ Yun further added that market can expect a surge in the spring as affordable housing conditions will entice buyers.
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Video of Lawrence Yun on lat month’s ( October) numbers
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Here is the NAR report :
The PHSI in the Northeast dropped 25.7 percent to 74.4 in November but is 14.7 percent above a year ago. In the Midwest the index fell 25.7 percent to 82.0 but is 9.2 percent higher than November 2008. Pending home sales in the South fell 15.0 percent to an index of 97.8, but are 14.7 percent higher than a year ago. In the West the index declined 2.7 percent to 124.6 but is 21.4 percent above November 2008.
Yun projects an additional 900,000 first-time buyers will qualify for the extended tax credit in addition to about 2 million who have already purchased; 1.5 million repeat buyers also are expected to benefit from the credit.
“Many trade-up buyers, who have historically timed their purchase based on school-year considerations, will have to accelerate their buying plans if they need the tax credit to make a trade,” Yun said. Repeat buyers do not have to sell their existing home to qualify for the credit, but they must occupy the home they buy as their primary residence.
Yun added that mortgage interest rates cannot remain at rock-bottom levels for a sustained period and will likely inch higher in 2010. But the tax credit impact in the first half of the year and expected job growth impact in the second half will support home buying activity and absorb enough inventory to bring a rough balance between buyers and sellers. Home prices are expected to stabilize or even modestly rise as a result in 2010.
The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.2 million members involved in all aspects of the residential and commercial real estate industries. Source
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