When a contract to buy a home is signed, that home’s sale is considered pending until it closes weeks later. The National Association of Realtors tracks pending sales because they’re considered a good indicator of future home sales numbers. After all, most contract signings will eventually lead to a closed sale. The NAR’s most recent Pending Home Sales Index found signings down 1.5 percent in October from the month before. Lawrence Yun, the group’s chief economist, says low supply is slowing signings. “Home sales are rising in places where more inventory is available,” Yun said. “Sales for properties above $750,000 were higher than a year ago, because there is more inventory at this price point than what we saw last October.” Similarly, newly built homes have also seen year-to-date increases due to rising construction activity. In other words, where there’s inventory, there are buyers, which means the overall lack of available homes for sale remains the primary factor holding home buyers back – even more than affordability challenges. (source)
