Pending Home Sales Definition

• Pending home sales represent signed contracts that have not closed. They are a leading indicator of existing home sales reports.
• Existing home sales are recorded at closing whereas new home sales are reported at signing.

The NAR reports Pending Home Sales Recorded No Change in November.

Key Points

• Pending home sales in November remained the same as one month ago.
• Month over month, contract signings grew in the Northeast, Midwest and West but they contracted in the South.
• Pending home sales dropped in all four U.S. regions compared to one year ago.

Trading Economics Month-Over-Month

United States Pending Home Sales MoMhttps://t.co/2fbb7i70re pic.twitter.com/40OB6lrxj5

— TRADING ECONOMICS (@tEconomics) December 28, 2023

Golden Handcuffs

Pending home sales remain down as so many people still have golden handcuffs of 2-3% mortgages in 6-8% environment; 100bpts of cuts doesn't fix that - the Fed would have to reinitiate ZIRP to really unfreeze the housing market; they've ruined everything... pic.twitter.com/w1ebkUQtq4

— E.J. Antoni, Ph.D. (@RealEJAntoni) December 22, 2023

New Record Low or Tied Low?

#US Pending Home Sales Index Slumps To New Record Low In November

US PENDING #HOME #SALES (MOM) (NOV) ACTUAL: 0.0% VS -1.5% PREVIOUS; EST 0.9% pic.twitter.com/XfOpcTvFWO

— Brickell Crypto (@Crypto_Brickell) December 28, 2023

Leading Index

The leading index for existing home sales, US #Pending #Home Sales were flat in November (+0.9% consensus) following a -1.2% MoM decline in October. That leaves sales down -5.1% YoY (NSA) vs -6.3% in Oct. The index was dragged down by weakness in the South while propped up in… pic.twitter.com/LXXHMsDKKG

— Macro84 (@macro84) December 28, 2023

Expectations vs Reality

The Bloomberg Econoday consensus estimate was for pending sales to rise 0.8 percent.

Instead pending sales were flat. The NAR revised October up from 71.4 to 71.6. This month was unchanged.

New Home Sales Down 12.2 Percent in November

Home builders finally ran out of incentives or consumers finally got fed up with what they are getting for their money. Here’s the result in pictures.

For discussion, please see Huge Thud in New Home Sales, Down 12.2 Percent in November

Existing Home Sales

(Click on image to enlarge)

Existing-home sales courtesy of the National Association of Realtors via the St. Louis Fed

In November, Existing Home Sales Rose 0.8 Percent, Only the Third Increase in 22 Months

The National Association of Realtors chief economist, Lawrence Yun, eyes a “marked turn“.

I highly doubt a major turn even if there is no recession. Mortgage rates and home prices are both still too high.

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