The Pending Home Sales Index, unchanged in September, has fallen on an annual basis in five of the past six months, and is at its lowest level since January 2015. The Pending Home Sales Index (PHSI), a forward-looking indicator based on signed contracts reported by the National Association of Realtors (NAR), remained unchanged at 106.0 from a downwardly revised August level. The PHSI is now 3.5% below its level a year ago.
The PHSI increased 1.9% in the West, 1.4% in the Midwest and 1.2% in the Northeast, but fell 2.3% in the South. Year-over-year, the PHSI decreased in all four regions, ranging from 2.4% in the Northeast to 5.0% in the South.
NAR reported that demand continues to overwhelm supply, especially for prospective buyers in the lower end of the market. Although existing sales were only a fraction higher in September, NAR reported a strong rebound for both Houston and Florida from Hurricanes Harvey and Irma. Moreover, builder confidence increased four points in October, and new home sales posted a banner month in September, suggesting new residential construction is addressing the demand for housing.