WASHINGTON (6/30/15)--Pending-home sales recorded yet another solid month of gains in May, as the National Association of Realtors’ index rose nearly 1% during the month to 112.6 (Economy.com June 29).
May's potential home sales also reached a nine-year high--jumping 10.4% on an annual basis.
“Much of the recent growth can be attributed to all-cash, trade-up and trade-down homebuyers,” said Brent Campbell, Moody’s analyst (Economy.com). “Nonetheless, some first-time homebuyers are now starting to re-enter the market, even as this portion of homebuyers is still relatively light.”
Not all regions faired equally, however.
The Northeast and West posted gains of 6.3% and 2.2% respectively, while the Midwest and South recorded declines of 0.6% and 0.8% respectively.
On an annual basis, sales climbed 13% in the West and 10.6% in both the Northeast and South. In the Midwest, sales only rose 7.8% from their year-ago levels.
Campbell said the pending-home sales index is a leading indicator for the housing market, and is a reliable predictor of changes in existing-home sales for subsequent months.
“All of the fundamental drivers of housing demand are moving in the right direction, and the most recent data point on potential-home sales is encouraging,” Campbell said.