Pending Home Sales Dip 1.8 Percent in August

WASHINGTON (September 27, 2018) – Pending home sales fell slightly in August and have now decreased on an annual basis for eight straight months, according to the National Association of Realtors®.

The Pending Home Sales Index,* www.nar.realtor/pending-home-sales, a forward-looking indicator based on contract signings, decreased 1.8 percent to 104.2 in August from 106.1 in July. With last month’s decline, contract signings are now down 2.3 percent year-over-year.

Lawrence Yun, NAR chief economist, says that low inventory continues to contribute to the housing market slowdown. “Pending home sales continued a slow drip downward, with the fourth month over month decline in the past five months,” he said.

“Contract signings also fell backward again last month, as declines in the West negatively impacted overall activity,” he said. “The greatest decline occurred in the West region where prices have shot up significantly, which clearly indicates that affordability is hindering buyers and those affordability issues come from lack of inventory, particularly in moderate price points.”

According to the third quarter Housing Opportunities and Market Experience (HOME) survey, a record high number of Americans believe now is a good time to sell. “Just a couple of years ago about 55 percent of consumers indicated it was a good time to sell; that figure has climbed close to 77 percent today.”

Added Yun, “With prices having risen so quickly, many consumers were deciding to wait to list their homes hoping to see additional price and equity gains. However, with indications that buyers are beginning to pull out, price gains are going to decelerate and potential sellers are considering that now is a good time to list and bring more properties to the market.”

Yun pointed to year-over-year increases in active listings from data at realtor.com® to illustrate a potential rise in inventory. Columbus, Ohio, Seattle-Tacoma-Bellevue, Wash., San Diego-Carlsbad, Calif., Providence-Warwick, RI-Mass. and Nashville, Tenn. saw the largest increase in active listings in August compared to a year ago.

When it comes to rising mortgage rates, Yun believes that while rising rates are always a deterrent to potential buyers, it should not lead to a significant decline. “We have two opposing factors affecting the market: the negative impact of rising mortgage rates and the positive impact of continued job creation. This should lead to future homes sales staying fairly neutral,” said Yun. “As long as there is job growth, rising mortgage rates will hinder some buyers; but job creation means second or third incomes being added to households which gives consumers the financial confidence to go out and make a home purchase.”

Yun expects existing-home sales this year to decrease 1.6 percent to 5.46 million, and the national median existing-home price to increase 4.8 percent. Looking ahead to next year, existing sales are forecast to rise 2 percent and home prices around 3.5 percent.

August Pending Home Sales Regional Breakdown

The PHSI in the Northeast dropped 1.3 percent to 92.7 in August, and is now 1.6 percent below a year ago. In the Midwest, the index slid back 0.5 percent to 101.6 in August and is also 1.1 percent lower than August 2017.

Pending home sales in the South dipped 0.7 percent to an index of 121.3 in August, however, that number is 1.3 percent higher than a year ago. The index in the West decreased 5.9 percent in August to 89.1 and plummeted 11.3 percent below a year ago.

The National Association of Realtors® is America’s largest trade association, representing 1.3 million members involved in all aspects of the residential and commercial real estate industries.

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*The Pending Home Sales Index is a leading indicator for the housing sector, based on pending sales of existing homes. A sale is listed as pending when the contract has been signed but the transaction has not closed, though the sale usually is finalized within one or two months of signing.

The index is based on a large national sample, typically representing about 20 percent of transactions for existing-home sales. In developing the model for the index, it was demonstrated that the level of monthly sales-contract activity parallels the level of closed existing-home sales in the following two months.

An index of 100 is equal to the average level of contract activity during 2001, which was the first year to be examined. By coincidence, the volume of existing-home sales in 2001 fell within the range of 5.0 to 5.5 million, which is considered normal for the current U.S. population.

NOTE: NAR’s September Housing Minute video will be released on September 28, Existing-Home Sales for September will be reported October 19, and the next Pending Home Sales Index will be October 25; all release times are 10:00 a.m. ET.

https://www.nar.realtor/newsroom/pending-home-sales-dip-18-percent-in-august

You found dozens of homes listed online that you love. Now what?

04/07/2017 | Author: Editorial Staff

It’s nice having options, right? Especially when it comes to making a big purchase like a home. If you’ve started your home search by using online listing sites, you’ve probably found a long list of properties you want to tour.

Even though it’s exciting to see what’s out there, are you wondering how you’ll be able to choose a favorite? Are you overwhelmed with your choices? That’s normal. In fact, research shows that when people have too many options, they have a harder time making a decision and tend to be less satisfied with their selection. Instead of making such an important decision on your own, there’s an easy way to get there faster: Hire a Texas REALTOR®.

Texas REALTORS® can help you quickly focus on properties worth seeing because they can eliminate those that may look good online but don’t actually meet your needs. They also have access to current information about whether a home is still on the market, and when homes you thought are out of your price range might actually be open to negotiations. This is information you won’t find on your own searching online, and even if you could, it would take a lot of your valuable time.

Visit texasrealestate.com to find a Texas REALTOR® who can help you avoid wasting your time and the stress that can come with choosing the perfect home.

https://www.texasrealestate.com/advice-for-consumers/article/you-found-dozens-of-homes-listed-online-that-you-love.-now-what

 

What’s the point of mortgage points?

09/30/2016 | Author: Editorial Staff

If you’re financing a property purchase, you’ve probably come across the term points or discount points. Although there are other meanings, most often these terms refer to prepaid interest, with one point equal to 1% of your mortgage loan.

Lenders offer borrowers the opportunity to purchase points on their mortgage, which means you’re paying up front to lower the interest rate of your loan. Here are some questions to ask when deciding whether you should buy points:

How long will you live in the house?
You usually benefit more from points the longer you stay in the property. That’s because the savings you realize on each monthly payment will accumulate and eventually offset—hopefully exceed—your points payment.

Can I afford points?
You need to provide a downpayment and cover the closing costs to secure a mortgage. Do you also want to pay for points?

How much will the rate come down?
Each point costs 1% of the loan amount, but the interest-rate reduction you receive varies from lender to lender.

https://www.texasrealestate.com/advice-for-consumers/article/whats-the-point-of-mortgage-points

Every real estate agent isn’t a REALTOR®?

If you’re planning to buy, sell, or lease property, you’re probably in the market for a real estate professional to help you through the process. But you may be stuck on who to choose. Depending on where you live, there may be many people interested in your business. Here’s one way to make it easier on yourself: Find a Texas REALTOR®.

Not all real estate agents are Texas REALTORS®
Anyone who wants to sell real estate in Texas must get licensed by the Texas Real Estate Commission (TREC). To obtain a license, someone must pass the real estate licensing exam, and after passing, must take real estate education classes. But these actions don’t make someone a Texas REALTOR®.

How does someone become a Texas REALTOR®? After obtaining his or her real estate license, the license holder can join the local association of REALTORS®, the state-level association of REALTORS®, and the National Association of REALTORS®. Only then may someone be called a REALTOR®.

What makes a Texas REALTOR® different?
REALTORS® follow a Code of Ethics. The Code of Ethics outlines how REALTORS® should serve consumers, and this consumer-oriented code holds REALTORS® to a high standard of professional behavior.

Membership in the Texas Association of REALTORS® has added benefits. Texas REALTORS® have exclusive access to more than 100 forms for many types of real estate transactions that other real estate agents don’t have. These forms can help you avoid legal problems down the line.

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