NEW YORK - Pending home sales grew 5.2% to a reading of 79.4 in July from a revised 2.8% decrease to 75.5 in June, originally reported as a 2.6% decrease to 75.7, according to an index released today by the National Association of Realtors.
Thomson Reuters’ poll of economists had predicted a 75.7 reading.
Year-over-year the pending homes sales index was down 19.1% from last July, when the index was 98.1.
Regionally, pending sales were higher. The Northeast saw a 6.3% increase to 62.5, while sales rose 4.1% to 66.7 in the Midwest. In the South sales climbed 1.2% to 86.3, while in the West, pending sales surged 11.6% to 95.0.
“Home sales will remain soft in the months ahead, but improved affordability conditions should help with a recovery,” NAR Chief Economist Lawrence Yun said. “But the recovery looks to be a long process. Home buyers over the past year got a great deal, and buyers for the balance of this year have an edge over sellers. For those who bought at or near the peak several years ago, particularly in markets experiencing big bubbles, it may take over a decade to fully recover lost equity,” he said.
“Affordability could reach a generational high in the second half of this year because of rock-bottom mortgage interest rates, helped partly by the Fed’s very accommodative monetary policy. The loan underwriting standards are tighter, but home buyers can improve their chances of getting a loan by staying well within their budget,” Yun said.
