Pending Home Sales Up 2.4% in February
February’s strong numbers put the industry in a good place to combat the economic hit the coronavirus brings. The pending home sales index increased 2.4 percent to 111.5 in February, while year-over-year contract signings increased by 9.4 percent. For context, an index of 100 is equal to the level of contract activity in 2001.
Hopeful for the housing market’s stamina
“February’s pending sales figures show the housing market had been very healthy prior to the coronavirus-induced shutdown,” says Lawrence Yun, NAR’s chief economist, noting that these numbers aren’t reflective of the pandemic’s economic effects. “Numbers in the coming weeks will show just how hard the housing market was hit, but I am optimistic that the upcoming stimulus package will lessen the economic damage and we may get a V-shaped robust recovery later in the year.”
February’s hot spots
The markets with significant buyer attention include:
- Colorado Springs, Colo.
- Lafayette, Ind.
- Modesto, Calif.
- Rochester, N.Y.
- Sacramento, Calif.
The potential to recoup sales
“Housing, just like most other industries, suffered from the coronavirus crisis, but once this predicament is behind us and the habit of social distancing is respected, I’m encouraged there will be continued home transactions though with more virtual tours, electronic signatures, and external home appraisals,” Yun explains. “Many of the home sales that are likely to be missed during the first part of 2020 may simply be pushed into late summer and autumn parts of the year.”
Growth across the board
Each of the four major regions experienced growth in both month-over-month contract activity and year-over year transactions.
February pending home sales index:
- Northeast: Up 2.8% to 96.3—5.9% higher than last year
- Midwest: Up 4.5% to 110.1—14.9% higher than last year
- South: Up 0.1% to 129.2—7.1% higher than last year
- West: Up 4.6% to 97.1—10.8% higher than last year