Pending Home Sales Rise 6% in September: NAR

Pending home sales based on signed contracts rose for the eighth consecutive month in September, according to the National Association of Realtors (NAR). The association’s pending sales index increased 6.1% from September to August and is 21.2% higher than September 2008. That’s the largest year-over-year increase and the longest streak of consecutive month-over-month increases since NAR began the index in 2001. “What we’re witnessing is a rush of first-time buyers trying to beat the expiration of the tax credit at the end of this month,” said NAR chief economist Lawrence Yun. “Home values will stabilize sooner rather than over-correcting. That, in turn, will mean wealth stabilization for the vast number of middle-class families and lay the foundation for a durable economic recovery.” Regionally, the index declined 2% in the Northeast, but increased in the South (4.9%), Midwest (8.1%) and West (10.2%). Homebuilding analysts at JP Morgan Securities, noting the index is up 34% Q109 and 19% above Q209, said the first-time homebuyer tax credit, which is set to expire on Nov. 30, could be a reason for the continued increase in demand, but the results continues to point to stabilization, if not slowly improving trends in the housing market Pending sales data is a typical leading indicator of existing home sales, the analysts wrote, and they expect October existing sales to increase at a rate near 6.1%. Write to Austin Kilgore.

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