Who Knows the Real Number?

Housing Wire, a mortgage trade publication and resource reported last week “pending home sales plummet to all time low .”  The source they're using is the National Association of Realtors Pending Home Sale index, and it fell to a low of 70.8 which is down 6.6 on a yearly basis.

The benchmark for that index is the calendar year 2001 to which they assign a value of 100. So as you can see there's been a significant drop in this number

The factor to which everyone attributes this decline is of course rising mortgage interest rates. First time home buyers have been largely priced out because of the increase in rates over the past two years coupled with the historic increase in home prices. Existing homeowners are hesitant to put their home on the market and lose the low interest rate they may have in place now.

NAR chief economist Lawrence Yun said “the market is at an interesting point with rising inventory and lower demand .” I’m not sure I agree or tink it is that simple. Yes inventory is rising, they're now forecasting a Increase in listings of almost 300,000, but even that inventory is low by historic standards. NAR also forecast a sales increase to 4.26 million homes this year  whereas the average historically has been over 5 million, but new housing starts are projected to fall. This is a mixed bag of information.

One must remember that while National Statistics are important, local factors matter more. And even with the local market like the Midlands, we find significant differences within geographic areas. Downtown area homes, whether it's Columbia, West Columbia, Cayce or Lexington, seemed to move quicker than suburban homes. Homes in certain price ranges seem to sell sometimes within the first few days of being on the market where the others are now languishing.

Before making any decision about buying or selling a home, you need to consult your real estate professional. Give us a call at the wheeler group and we'll be glad to help