By Peter Ricci
Pending home sales rose year-over-year for the 14th consecutive month in June, according to the latest Pending Home Sales Index from the National Association of Realtors.
A forward-looking index based on contract signings, the Pending Home Sales Index (PHSI) rose 9.5 percent from June 2011, though it did decline a bit by 1.4 percent from May 2012.
Lawrence Yun, NAR chief economist, said inventory shortages were a factor in the index’s monthly slip.
“Buyer interest remains strong but fewer home listings mean fewer contract signing opportunities,” Yun said, echoing his statements for last week’s existing-home sales data. “We’ve been seeing a steady decline in the level of housing inventory, which is most pronounced in the lower price ranges popular with first-time buyers and investors.”
And NAR’s Confidence Index does support Yun’s claims of an imbalance. While buyer traffic for the index was rated at a 60, seller traffic was just 41, showing an imbalance between housing supply and demand that has been present in the market the last couple months (a value of 50 signifies neutral market conditions).
Though that may be what NAR’s data is showing for the nation on a whole, it’s not what Robyn Jones, the broker/owner of Robyn Jones Homes, is seeing throughout the Houston area.
“My experience has been, for me and my agents, that the homes that are priced correctly are moving,” Jones said. “The ones that are priced correctly fly; it doesn’t matter where they are.”
Of course, Jones added that properties that are not priced correctly are still “problematic,” particularly at the appraisal stage, but for properties that are priced to sell, the demand has been so strong that the homes are receiving multiple offers.
Such demand, though, is not negatively impacting supply. Jones said the Houston and Katy areas are “abundant” with available inventory, and she said the reason for that is the relative balance under which the Houston market operates. Though there are many buyers, there are also many sellers looking to downsize to smaller units or buy up to larger homes and take advantage of the low interest rates, and because there is movement on both ends, there is balance.