Pending Home Sales Plummet
by Tom on January 5, 2010
in Market Musings
November’s pending home sales (in other words signed purchase agreements) fell a dramatic 16% compared to October of this year. A couple of thoughts:
- I think the numbers for October were artificially inflated by the “scare tactics” that were used by many to encourage first time buyers to buy before the tax credit ended at the end of November. Once that window was past (by the middle of Nov. you weren’t going to make the Nov. 30 deadline no matter how you tried), that let a lot of steam out of the market.
- Sales were up 15.5% compared to November of 2008. That’s good, right? Yeah, that’s good, but let’s think back to November of 2008. We thought the financial world was falling apart and it was Armageddon of the Financial Type. It’s no wonder things were bad then. Saying that things are up from November of 2008 is sort of like saying that someone with a 101 fever is doing well – because last week he had a 104.5 fever. True, he’s better, but he isn’t healthy yet.
I’ll have more as the news justifies.
Tom Vanderwell
Calculated Risk: Pending Home Sales Decrease Sharply
From the NAR:The Pending Home Sales Index,* a forward-looking indicator based on contracts signed in November, fell 16.0 percent to 96.0 from an upwardly revised a 114.3 in October, but is 15.5 percent higher than November 2008 when it was 83.1.
Technorati Tags: Pending Home Sales
