New market indicator from NAR

“After several years of study and data
collection, the National Association of Realtors has developed the Pending Home
Sales Index (PHSI), a new leading indicator for the housing
market.

The index aims to provide
advance information on future home-sales activity and offers more solid
information on changes in the direction of the market than any of the indicators
currently available, according to the
association.

The Pending Home Sales
Index, based on data collected for January, stands at 120.6, which was 2.1
percent below December but 8.6 percent above January 2004…. A home sale is
pending when the contract has been signed but the transaction has not closed….
It may be flawed for two reasons – one is that real estate purchases are
frequently emotional purchases which cannot be quantified with numbers….
While the national numbers may be an indication of the market’s state, no
national index can accurately predict local markets’ activity.

Hmmm … from Inman today.
After several years of study and data
collection, the National Association of Realtors has developed the Pending
Home Sales Index
(PHSI), a new leading indicator for the housing
market.

The index aims to
provide advance information on future home-sales activity and offers more solid
information on changes in the direction of the market than any of the indicators
currently available, according to the
association.

The Pending Home
Sales Index, based on data collected for January, stands at 120.6, which was 2.1
percent below December but 8.6 percent above January 2004. The index is based on
pending sales of existing homes, including single-family, condo and co-op. A
home sale is pending when the contract has been signed but the transaction has
not closed. Pending sales will typically close within one or two months of
contract signing.”
I do not yet know what to
make of this new index. It may be flawed for two reasons – one is that real
estate purchases are frequently emotional purchases which cannot be quantified
with numbers. Two is that all real estate is local (as I say frequently). While
the national numbers may be an
indication
of the market’s state, no national index can accurately predict local markets’
activity.

(Visited 1 times, 1 visits today)