Pending home sales increasing in November, but at 3.5% still not completely healthy

Pending home sales rose again in November, with the broad trend over the past five months indicating a gradual recovery into 2011, according to the National Association of Realtors.

The Pending Home Sales Index, a forward-looking indicator, rose 3.5% to 92.2 based on contracts signed in November from a downwardly revised 89.1 in October. The index is 5% percent below a reading of 97.0 in November 2009. The data reflects contracts and not closings, which normally occur with a lag time of one or two months.

The housing sector may be climbing up from the bottom but if so, it looks like the climb is slow. Pending sales of existing homes rose 3.5%, which is respectable, but well below the 10.1% jump in October that ended a run of declines.
The key region, the South, shows a small decline with the Midwest showing a more sizable decline. The Northeast shows a small increase while the West, the smallest and most volatile region, shows a big jump.

NAR release


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