Pending Homes Sales Increase in December, Ending Six Consecutive Monthly Declines

The National Association of Realtors® (NAR) reported on Friday (1-27-23) that its Pending Homes Sales Index (PHSI), which is based on signed real estate contracts, not actual closings, for existing single-family homes, condominiums, and co-ops, increased 2.5% month-over-month in December to a reading of 76.9. An index of 100 is equal to the level of contract activity in 2001. This marks the first increase in the PHSI since May 2022. Year-over-year contract signings declined 33.8%.

The NAR is reporting that in December two regions posted losses, while two regions posted gains.

• The Northeast PHSI declined 6.5% to a reading of 64.7, a drop of 32.5% from December 2021.
• The Midwest PHSI decreased 0.3% to reading of 77.6, down 30.1% from a year ago.
• The South PHSI posted an increase of 6.1% to a reading of 94.1 but was down 34.5% from December 2021.
• The West PHSI increased 6.4% to a reading of 58.6 but was down 37.5% from December 2021.