The National Association of Realtors® (NAR), has reported that after two months so declines their Pending Homes Sales Index (PHSI) increased 44.3% to a reading of 99.6 in May. This is the highest month-over-month gain the PHSI since the NAR started the series in January of 2001. Year-over-Year contract signings decreased -5.1%. An index of 100 is equal to the level of contract activity in 2001. The PHSI is a leading indicator of housing activity, measures housing contract activity, and is based on signed real estate contracts, not actual closings, for existing single-family homes, condos, and co-ops. In prepared remarks Lawrence Yun, NAR’s chief economist said, “This has been a spectacular recovery for contract signings and goes to show the resiliency of American consumers and their evergreen desire for homeownership. This bounce back also speaks to how the housing sector could lead the way for a broader economic recovery”. “More listings are continuously appearing as the economy reopens, helping with inventory choices,” Yun said. “Still, more home construction is needed to counter the persistent underproduction of homes over the past decade.”
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