A report recently shared by the National Association of Realtors (NAR) has shown that pending home sales were increasing. Previous months had indicated increases overall, yet there were some minor dips in select areas at times. For August, all four major regions in the United States have shown gains.
The Pending Home Sales Index had increased by 1.6% during the month of August making contract signings up by 2.5% over that of 2018 at this time. “It is very encouraging that buyers are responding to exceptionally low interest rates,” said Lawrence Yun, NAR chief economist. “The notable sales slump in the West region over recent years appears to be over. Rising demand will reaccelerate home price appreciation in the absence of more supply.”
Breakdown by Region
The highest gain was shown in the West. The Northeast experienced a 1.4% gain while the Midwest had a 0.6% increase. The South inched up by 1.4% while the West had the largest surge at 3.1% which was up by 8% over last year.
“With interest rates expected to remain low, home sales are forecasted to rise in the coming months and into 2020,” said Yun. “Unfortunately, so far in 2019, new home construction is down 2.0%. The hope is that housing starts quickly move into higher gear to meet the higher demand. Moreover, broader economic growth will strengthen from increased housing activity.”
The National Association of Realtors is anticipating that sales will continue to increase. They forecast that there will be a 0.6% rise for the rest of 2019 and expect another 3.4% come next year. Housing starts are anticipated to go up this year by 2% with an additional 10.6% for next year.