The Pending Home Sales Index declined in June after reaching the highest level in over nine years in May. The Pending Home Sales Index (PHSI), a forward-looking indicator based on signed contracts reported by the National Association of Realtors (NAR), decreased 1.8% in June, but is up 8.2% from the same month a year ago, and has increased year-over-year for ten consecutive months.
Regionally, 3.0% declines in the Midwest and South were only partially offset by small increases in the Northeast and West. Year-over-year, the PHSI was up 12.0% in the Northeast, 10.4% in the West, 7.8% in the South and 5.0% in the Midwest.
The earlier string of positive pending sales releases in 2015 was consistent with a strong report last week as existing sales reached a pre-recession level. The June PHSI is a small bump in the road, and follows last week’s similar decline in new home sales, which are also based on contracts. However, the longer view suggests continued good news for the existing sales market and for builders in 2015.