Pending home sales fell 7.1% in August; 18.7% y-o-y

Economy
1

Home prices are up (a little) this summer
That according to the Case-Shiller, the gold standard in home prices indicators.

Nonetheless the VOLUME of homes (number of homes) selling has been in steep decline.

From the article:

Mirroring the trend for new home sales, pending home sales fell 7.1% in August, according to data released Thursday by the National Association of Realtors (NAR). All four regions of the U.S. posted month-over-month and year-over-year declines in transactions.

Year over year, pending home sales were down 18.7%, an even greater decrease than the 14% annual drop recorded in July.

2

As mentioned home prices rose a little this summer.

The S&P CoreLogic Case-Shiller National Home Price Index in July increased 0.6% month over month and 1% over the last 12 months

3

i think the calculated risk blog has it correct.

Two key points:

  1. There is a clear seasonal pattern for house prices.
  2. The surge in distressed sales during the housing bust distorted the seasonal pattern. This was because distressed sales (at lower price points) happened at a steady rate all year, while regular sales followed the normal seasonal pattern. This made for larger swings in the seasonal factor during the housing bust.

the seasonal patten point is extremely important.

Allan

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