by Mish Shedlock, Mish Talk:
Pending home sales, a gauge of existing home sales in progress, is down for the sixth month, and a whopping eleven months year-over-year.
Understanding Pending Sales
New home sales are recorded at contract signing but existing home sales at closing. The pending home sales index is a gauge of future existing home sales reports.
TRUTH LIVES on at https://sgtreport.tv/
The National Association of Realtors reports Pending Home Sales Descend 3.9% in April
- The Pending Home Sales Index (PHSI), a forward-looking indicator of home sales based on contract signings, slid 3.9% to 99.3 in April.
- This was the 6th consecutive month of lower sales.
- Year-over-year, transactions fell 9.1%, the eleventh month of lower sales.
Pending Home Sales Year-Over-Year
Going to Get Worse
Ignoring the brief Covid-related downturn, we have not seen a dip like this since 2011.
But it’s going to get worse.
NAR Pending Home Sales Data Provides More Evidence of a Severe Housing Slump
On May 23, I commented NAR Pending Home Sales Data Provides More Evidence of a Severe Housing Slump
Active listings are down and pending listings of all contracts are down 17.4%
- Based on preliminary data, new contracts signed decreased 11.7% on a year-over-year basis while new pending listings increased 1.1%.
- The inventory of pending listings (all contracts signed) was down 17.4% from one year ago, while the inventory of active listings fell at a lower rate of 4.2% from one year ago.
New Home Sales Plunge 22.5% In April, 16.6% From Deep Negative Revisions
In case you missed it, please see New Home Sales Plunge 22.5% In April, 16.6% From Deep Negative Revisions
On May 19th I noted Existing Home Sales Skid to Pre-Pandemic Level, a Housing Bust is Underway
Relative Economic Activity Importance
- New home sales are an indication of family formation, but for current economic impacts, existing home sales are far more important because they dwarf new home sales.
- The current seasonally-adjusted annualized rate of new home sales is 591 thousand.
- The current seasonally adjusted annualized rate of existing home sales is 5.61 million.
Reflections on Inventories, Retail Sales, and Durable Goods