August 27, 2018

July pending home sales hit a 2018 high

New contracts on single-family, condominium and townhome sales hit a 2018 high point in July.

The Northeast Tennessee Association of Realtors' (NETAR) New Pending Home Sales Index (PHSI), a forward-looking indicator based on new contract signing reported by Realtor Property resource (RPR), was up 2.4 points from June. That's the highest month-to-month increase since April 2016. Compared to July last year the index is up 1.8 percent.

There were 874 new approved contracts in July bringing the pending sales total to 1,190, said Aaron Taylor NETAR President. "In July we had 3.6 months inventory of homes for sale in the region. It was the tightest inventory we've seen in over two years," he added. At the same time, there were more new listings than new approved contracts so we're beginning to see a slight inventory improvement.

June's new pending sales index was 133.9 up from 131.5 in June. The PHSI is a leading indicator for the housing sector based on pending sales of existing homes, condos and townhomes. The benchmark for the index is the 2015 annual average for new approved contracts. A sale is listed as pending when a contract has been signed, but the transaction has not closed. Sales are typically finalized in a month or two after signing. It's not uncommon to see as many as 5 percent of pending sales fall through. Lately, that fall-through rate has been a little higher due to more sale of a current home and financing contingencies.

NETAR is the voice for real estate in Northeast Tennessee - is the largest trade association in Northeast Tennessee, Southwest Virginia region representing over 1,200 members and 100 affiliates involved in all aspects of the residential and commercial real estate industries.