For the third month in a row, the number of pending home sales in the United States rose. This information comes from the National Association of Realtors, who also said pending home sales reached their highest level in over ten years.
The Pending Home Sales index is based on contract signings from homes that have not quite sold. It rose 5.1 percent in April. It was 4.6 percent above April 2015. The number of pending home sales has now increased year-to-year for 20 months in a row. NAR chief economist Lawrence Yun said gains in the South and West helped the numbers increase a lot. In the South, pending home sales increased 6.8 percent.
“The ability to sign a contract on a home is slightly exceeding expectations this spring, even with the affordability stresses and inventory squeezes affecting buyers in a number of markets,” Yun says. “The building momentum from the over 14 million jobs created since 2010 and the prospect of facing higher rents and mortgage rates down the road appear to be bringing more interested buyers into the market.”
Pending home sales are so high for several reasons. Yun notes how mortgage rates have remained low- below 4 percent- in 16 of the last 17 months. However, no one can tell for sure how long they will stay low. Florida Realtors wrote that Yun thinks rates will stay around 4 percent in the near future, but inflation may raise them.
“Even if rates rise soon, sales have legs for further expansion this summer if housing supply increases enough to give buyers an adequate number of affordable choices during their search,” adds. Yun.
Yun also foresees home sales for the year exceeding previous predictions. He thinks they will reach a level 3 percent about 2015.
The levels of pending home sales indicate a bright future for real estate! Take advantage of today’s market and low mortgage rates and contact RE/MAX Paradise about your dream home in Miami!