What Pending Sales Are And Why They're Important
After a contract to buy a home is signed, that home's sale is considered pending until closing. This period usually last several weeks, while the home and its sale goes through all the necessary steps to confirm, verify, and ensure every part of the transaction. Because of that weeks-long gap between contract signings and closings, tracking the number of signings is a fairly accurate way to forecasting what upcoming sales reports will show. After all, since most contract signings end up as final sales, increasing sales numbers typically follow increasing signings. That's why the National Association of Realtors measures them monthly with their Pending Home Sales report. According to their most recent release, October saw a month-over-month decline but, overall, signings are up over last year's numbers. In fact, contract signings were 4.4 percent higher than year before levels. Lawrence Yun, NAR's chief economist, says there are plenty of buyers right now but still not enough homes for sale. “We still need to address and, more importantly, correct inadequate levels of inventory across the country,” Yun said. “There is no shortage of buyers seeking homes, but a lack of available units continues to drag down the nation's housing market and overall economy.” As inventory levels rise and offer buyers more choices, sales will likely follow. More here.