The Pending Home Sales Index increased slightly by 0.2% in November, and is 0.8% above a year ago. The Pending Home Sales Index (PHSI) is a forward-looking indicator based on signed contracts reported by the National Association of Realtors (NAR).
The PHSI increased 4.1% in the Northeast and 0.4% in the Midwest, but decreased 0.4% in the South and 1.8% in the West. Year-over-year, the PHSI increased 2.5% in the South, 1.1% in the Northeast and 0.8% in the Midwest, but decreased 2.3% in the West.
NAR projected that existing home sales and price growth will slow because of altered tax benefits in some high cost areas. However, existing sales surged in November, and builder confidence is strong. Job growth, increasing homeownership rates and limited inventory are the right combination to spur continued growth in new residential construction.