Pending Home Sales Rise 7.4%

[Originally Published By THE ASSOCIATED PRESS

Published: October 8, 2008

WASHINGTON (AP) — Pending home sales rose 7.4 percent from July to August, an industry group said Wednesday in an unexpected piece of positive news for the battered housing market.

The group, the National Association of Realtors, said its seasonally adjusted index of pending sales for existing homes rose to 93.4 from an upwardly revised July reading of 87. The reading was the highest since June 2007.

Home sales are considered pending when the seller has accepted an offer but the deal has not yet closed. Typically there is a one- to two-month lag before a sale is completed.

Wall Street economists surveyed by Thomson IFR had predicted the index would fall to 84.9.

The index, which sunk to a record low of 83 in March, stood at 85.8 in August 2007.

Sales are picking up in places where housing prices have declined severely, including Arizona, California, Florida, Nevada and Rhode Island and the Washington, D.C., area, said Lawrence Yun, the association’s chief economist. Still, Mr. Yun does not expect home prices to rebound until next year and expects only a modest gain — 2 to 3 percent — in 2009.]

Looks like a small glimmer of things to come as we begin to push forward with the current economic issues facing our industry.  I can honestly relay a similar increase in pending sales for myself in our local market over the past month.  I currently have 4 properties under contract or “pending” sales that originated over the past 3 weeks, and this is a nice increase in activity versus the levels seen over the past 3 months.

Another positive outlook I see with the current properties under contract is that the overall contracts are fairly strong as it appears right now.  For sellers, the buyers that are writing offers right now seem to be well prepared – they’ve been to their lenders early, gotten their pre-approvals in place and know what they need to do to find a property that they will be comfortable in for a few years to come.  For buyers, if you can acquire financing or have cash to spend right now then you should be able to locate properties that are priced competitively and should help you return modest gains on your investments over the next few years of ownership.  To all the pessimests out there – getting approved for good loans is still readily possible if you’re a good candidtate with good credit and a stable job history with a little bit of money in the bank.

My suggestion: Don’t wait until you know you WOULD have gotten a good deal had you bought a home.  At that point, it’s already past the prime time to invest for future gains.  Speculation in the markets can be a good thing at times, but currently there are too many folks on the fence speculating about when the best time to purchase will be.  Don’t be one of these people left sitting on the fence when the market turns.  Do your due diligence and research the current market values and do a little forecasting on your own to see if now is the BEST time to make your move.  I’ll be happy to help if you need it.