Pending Home Sales Bounce Back in July

Posted by blogekiyai on Thursday, August 28, 2014

Pending Home SalesMichael Dwyer/AP By JOSH BOAK

WASHINGTON -- More Americans signed contracts to buy homes in July, a sign that buying has improved as mortgage rates have slipped, the number of listings has risen and the rate of price increases has slowed.!

The National Association of Realtors said Thursday that its seasonally adjusted pending home sales index rose 3.3 percent to 105.9 last month. Still, the index remains 2.1 percent below its level a year ago.

Ian Shepherdson, chief economist at Pantheon Macroeconomics, called the increase "positive" but stressed that home buying was unlikely to strengthen significantly.

"Sales cannot rise much more before they hit the fundamental problem that the pool of would-be buyers is just not big enough," Shepherdson said.

The pressures that caused home sales to stall last year have started to ease. The average 30-year fixed mortgage rate has dropped to 4.1 percent, a 52-week low. Prices are no longer rising at double-digit annual rates, thereby helping to improve affordability.

Pending sales are a barometer of future purchases. A one- to two-month lag usually exists between a contract and a completed sale.

The number of signed contracts in the Nort! heast climbed 6.2 percent and is ahead of its pace last year. ! Pending sales also rose in the South and West, though the index for both regions remains below its levels in July 2013. Contracts in the Midwest fell 0.4 percent last month and also lag behind the pace of a year ago.

Modest wage growth, which has barely run ahead of inflation, has hampered home sales. The Realtors forecast that roughly 5 million existing homes will be sold this year, down from 5.1 million in 2013.

But price growth, which had hurt affordability at the end of last year, has moderated in recent months.

The Standard & Poor's/Case-Shiller 20-city home price index rose 8.1 percent in June from 12 months earlier, according to a report this week. Year-over-year price gains at the start of 2014 had averaged more than 13 percent, according to the Case-Shiller index.

And while more homeowners have started to list their properties for sale, the ability of the real estate market to grow is limited.

Tha! t's largely due to the consequences of the housing bust that triggered the Great Recession at the end of 2007. Nearly 35 percent of homeowners are still "effectively underwater" on their mortgages: They either have less than 20 percent equity in their homes or they couldn't sell their properties and have enough money left for a down payment on another home, the online real estate firm Zillow (Z) said this week.

  • Year-over-year gain: 21.5%

    Median sale price, Jan. 2013: $224,450

    Median sale price, Jan. 2014: $272,750

    Residents enjoy hundreds of nearby hiking trails, as well as indoor culture at the Fine Arts Center and the Colorado Springs Philharmonic.

    Northwest Colorado Springs, Colorado Springs, Colo.
  • Year-over-year gain: 22%

    Median sale price, Jan. 2013: $318,375

    Median sale price, Jan. 2014: $388,500

    This neighborhood, bounded by the Schuylkill River and 20th Street, and by South Street and Christian Street, was viewed as a slum in the 1970s, when Philadelphia's Redevelopment Authority took over abandoned properties.

    Schuylkill Southwest, Philadelphia, Pa.
  • Year-over-year gain: 24.2%

    Median sale price, Jan. 2013: $516,450

    Median sale price, Jan. 2014: $641,500

    Magnolia covers 4 square miles, making it the second-largest Seattle neighborhood by area. It features a lighthouse built in 1881 and is home to Seattle's largest park, at 534 acres.

    Magnolia, Seattle, Wash.
  • Year-over-year gain: 32.1%

    Median sale price, Jan. 2013: $210,446

    Median sale price, Jan. 2014: $277,898

    Paradise Valley, in the heart of the Scottsdale-Phoenix area, gets an average 294 days of sunshine a year -- hence, the more than 200 golf courses.

    Paradise Valley, Phoenix, Ariz.
  • Year-over-year gain: 32.2%

    Median sale price, Jan. 2013: $344,750

    Median sale price, Jan. 2014: $455,835

    The Washington Post listed Sunset Hills among "the shortest commute" category of Virginia neighborhoods, with an average commute time of just over 21 minutes. And Dulles International Airport is about six miles away.

    Sunset Hills, Reston, Va.
  • Year-over-year gain: 44.5%

    Median sale price, Jan. 2013: $247,735

    Median sale price, Jan. 2014: $357,900

    This once-seedy area has become hot in recent years. It's packed with art galleries and chic retail shops, as well as new upscale bars and restaurants next to venerable family-owned cafeterias.

    Wynwood/Edgewater, Miami, Fla.
  • Year-over-year gain: 46.9%

    Median sale price, Jan. 2013: $284,750

    Median sale price, Jan. 2014: $418,250

    Brighton, once the center of New England's cattle trade, is in the northwest corner of Boston, on the Charles River. The Brighton Branch Library is Boston's first renovated LEED Green Building. The Brighton Police station is shown here.

    Brighton, Boston, Mass.
  • Year-over-year gain: 47.5%

    Median sale price, Jan. 2013: $223,175

    Median sale price, Jan. 2014: $329,100

    South Loop joins a number of other once-blighted neighborhoods on this list that have been redeveloped and are now hot. The site of former rail yards, it was known for many years more for its vices (as in brothels, burlesques) than its residential virtues.

    South Loop, Chicago, Ill.
  • Year-over-year gain: 48.7%

    Median sale price, Jan. 2013: $241,000

    Median sale price, Jan. 2014: $358,450

    Also: Fairgrounds, San Jose (41.4%); La Jolla, San Diego (40%); Woodland Hills, Los Angeles (37.5%); Southwest Anaheim, Anaheim (35.2%); Berryessa, San Jose (34.4%).

    Newhall, the southernmost and oldest district of Santa Clarita, was the first permanent Anglo settlement in the valley. Ranches-turned-film studios dot the area, including the Melody Ranch, which was once owned by Gene Autry. The ranch hosts the annual Santa Clarita Cowboy Festival.

    Newhall, Santa Clarita, Calif.
  • Year-over-year gain: 48.8%

    Median sale price, Jan. 2013: $504,250

    Median sale price, Jan. 2014: $750,275

    This is the most affluent neighborhood in Charlotte; the median income is $79,737, according to Zillow. That compares with a median of $46,975 for Charlotte. A high point of the area is the Duke Mansion, built in 1915 by tobacco magnate James Buchanan Duke.

    Myers Park, Charlotte, N.C.
  • Year-over-year gain: 57.4%

    Median sale price, Jan. 2013: $167,450

    Median sale price, Jan. 2014: $263,615

    People who live here, according to classifications Zillow uses to characterize residents, are likely to be: Corporate Climbers, Multi-lingual Urbanites or in a category called "Bright Lights, Big City," which Zillow uses to describe "singles ranging in age from the early 20s to mid-40s who have moved to an urban setting."

    Buffalo, Las Vegas, Nev.
  • Year-over-year gain: 97.3%

    Median sale price, Jan. 2013: $668,250

    Median sale price, Jan. 2014: $1,318,301

    New York City's 92-acre planned community includes areas built on more than 3 million cubic yards of soil and rock, some of which was excavated during the construction of the World Trade Center.

    Battery Park, New York City, N.Y.
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Source : http://www.dailyfinance.com/2014/08/28/pending-home-sales-rise-july/