The Pending Home Sales Index soared 5.1% in April to the highest level in over a decade, and has increased year-over-year for 20 consecutive months. The Pending Home Sales Index (PHSI), a forward-looking indicator based on signed contracts reported by the National Association of Realtors (NAR), increased to 116.3 in April from an upwardly revised 110.7 in March, and is 4.6% above the same month a year ago.
The PHSI increased 11.4% in the West, 6.8% in the South and 1.2% in the Northeast, while remaining essentially flat for a successive month in the Midwest. Year-over-year, the PHSI increased 10.1% in the Northeast, 5.1% in the South, 2.8% in the West and 2.0% in the Midwest. The improved picture in the West contrasted with disappointing data earlier in the year for that region which NAR attributed to the rapid increase in median home prices over the past three years.
Existing sales continued upward by 1.7% in April, and the strong PHSI report plus low mortgage rates suggest a continuing steady recovery through the summer. However, the long-term weakness among first-time buyers continues to dampen all sales in 2016.