Three U.S. regions—the South, Midwest, and Northeast—all posted monthly gains while the West declined. Pending sales for all four regions registered year-over-year drops, with an overall decline of 21.1%.
The PHSI is based on contract signings, which typically precede a closing by one to two months. Though the duration can vary widely, signings are generally a good early indicator of an eventual sale closing.
After nearly a year, the housing sector’s contraction is coming to an end. Existing-home sales, pending contracts and new-home construction pending contracts have turned the corner and climbed for the past three months.
Lawrence Yun - NAR Chief Economist
THE SOUTH AND MIDWEST ARE LEADING THE RECOVERY
The Northeast PHSI rose 6.5% from the previous month to 72.5%, a 17% drop from one year ago. The Midwest index rose 0.4% to 84.9% in February, dropping 16.5% from February 2022.
The South PHSI rose 0.7% to 99.3% in February, declining year over year by 21.7%. And the West index dropped 2.4% in February to 64.6%, falling 28.4% from one year ago.
The affordable U.S. regions—the Midwest and South—are leading the recovery. Mortgage rates have improved in recent weeks after the federal government guaranteed the status of most mortgages amidst uncertainty in the financial market. While access to commercial mortgage loans could become increasingly difficult, residential mortgage loans are expected to be more readily available.
Lawrence Yun - NAR Chief Economist
THE PENDING HOME SALES INDEX
As a leading indicator for housing, the Pending Home Sales Index (PHSI) is based on a sample that represents about 40% of MLS data each month.
Sales are considered pending when the contract has been signed but the sale hasn’t yet closed...
Posted by:
Mar 30, 2023
