U.S. Pending Home Sales Gain for the Fourth Straight Month in November
Summary
- PHSI +2.2% (+6.9% y/y) in November vs. +1.8% (+5.3% y/y) in October.
- Home sales up m/m in the South (5.2%), West (0.5%) and Midwest (0.4%) but down m/m in the Northeast (-1.3%).
- Home sales up y/y in all four regions, w/ the highest y/y rate in the West (11.8%).
The Pending Home Sales Index, a forward-looking measure of home sales based on contract signings, rose 2.2% m/m to 79.0 in November after a downwardly revised 1.8% increase to 77.3 in October (+2.0% & 77.4 initially) and a 7.5% gain in September (unrevised), according to the National Association of Realtors (NAR). The November reading was the fourth consecutive m/m rise and the highest PHSI level since February 2023. The year-on-year rate accelerated to 6.9% in November, the highest since May 2021, from 5.3% in October; thus, posting an improvement from a negative 4.6% in November 2023. Nevertheless, the PHSI had fallen 36.9% since its October 2021 high of 125.1 and 38.3% since its August 2020 peak of 128.0.
The m/m rise in November sales occurred as the average rate on a 30-year mortgage rose to 6.81% in November, the highest since July, after rising to 6.43% in October. These rates, while below their recent high of 7.62% in October 2023, had remained higher than a low of 5.22% in August 2022 and well above a record-low 2.68% in December 2020.
Pending home sales rose m/m in November in three of the four major regions. Sales in the South advanced 5.2% (8.5% y/y) in November, the third successive m/m gain, after a 0.7% increase in October. Sales in the West rose 0.5% (11.8% y/y), the third m/m rise in four months, following October’s no change. Sales in the Midwest grew 0.4% (1.6% y/y), the fourth straight m/m increase, on top of a 4.0% October rise. To the downside, sales in the Northeast fell 1.3% (+5.6% y/y) in November, the first m/m fall since August, following a 4.7% gain in October.
The pending home sales index measures sales at the time the contract for the purchase of an existing home is signed, similar to the Census Bureau's new home sales data. In contrast, the National Association of Realtors' existing home sales data are recorded when the sale is closed, which is usually a couple of months after the sales contract has been signed. In developing the pending home sales index, the NAR found that the level of monthly sales contract activity leads the level of closed existing home sales by about two months.
The series dates back to 2001 and are available in Haver's PREALTOR database. Weekly mortgage interest rates from the Mortgage Bankers Association can be found in the WEEKLY database.
Winnie Tapasanun
AuthorMore in Author Profile »Winnie Tapasanun has been working for Haver Analytics since 2013. She has 20+ years of working in the financial services industry. As Vice President and Economic Analyst at Globicus International, Inc., a New York-based company specializing in macroeconomics and financial markets, Winnie oversaw the company’s business operations, managed financial and economic data, and wrote daily reports on macroeconomics and financial markets. Prior to working at Globicus, she was Investment Promotion Officer at the New York Office of the Thailand Board of Investment (BOI) where she wrote monthly reports on the U.S. economic outlook, wrote reports on the outlook of key U.S. industries, and assisted investors on doing business and investment in Thailand. Prior to joining the BOI, she was Adjunct Professor teaching International Political Economy/International Relations at the City College of New York. Prior to her teaching experience at the CCNY, Winnie successfully completed internships at the United Nations. Winnie holds an MA Degree from Long Island University, New York. She also did graduate studies at Columbia University in the City of New York and doctoral requirements at the Graduate Center of the City University of New York. Her areas of specialization are international political economy, macroeconomics, financial markets, political economy, international relations, and business development/business strategy. Her regional specialization includes, but not limited to, Southeast Asia and East Asia. Winnie is bilingual in English and Thai with competency in French. She loves to travel (~30 countries) to better understand each country’s unique economy, fascinating culture and people as well as the global economy as a whole.
