Home Sales on the Rise – Especially the Phoenix Market
Last month, for the fifth straight month, the Pending Home Sales Index hovered near its benchmark value of 100, registering 99.5 in September. The Pending Home Sales Index tracks homes under contract to sell, but not yet sold, and is published by the National Association of REALTORS®. The index is a relative one. It compares today’s housing market activity to the housing market activity of 2001 — the index’s first year of existence. Phoenix homes for sale have increased in value on average by 30% in some market areas.
The Pending Home Sales Index has averaged 99.1 this year. Among housing market indicators, the Pending Home Sales Index is unique. It doesn’t report on prior market activity as the Existing Home Sales and New Home Sales reports do. By contrast, the Pending Home Sales Index is a forward-looking indicator. Housing inventory in Phoenix has been very low; down to 8,000 units during the first six months of 2012, and up to 12,000 single family units in the fall of 2012.
The real estate trade association tell us that 80% of U.S. homes under contract go to closing within 60 days, and many of the rest go within Months 3 and 4. In this way, the monthly Pending Home Sales Index can foreshadow to today’s Phoenix home buyers and sellers what’s next for housing.
Based on September’s Pending Home Sales Index, then, we should expect to see closed home sales stay strong through November and December. That said, home sales are expected to vary by region.
Here is how the Pending Home Sales Index broke down by area last month as compared to one year ago on a seasonally-adjusted, annualized basis :
- Northeast Region : +26.1% from September 2011
- Midwest Region : +19.3% from September 2011
- South Region : +17.6% from September 2011
- West Region : +0.8% from September 2011
Often, the last few months of a year are considered to be a “slow” period for the housing market. Based on regional, annual Pending Home Sales Index improvements, though, 2012 may be different. The market looks poised to finish with momentum that may carry home prices higher into 2013. If you are looking for one of the homes for sale in Phoenix, please give me a call. If you are looking for a Chinese Realtor in Phoenix, please call me.
