June Pending Home Sales - Business Insider

The Pending home sales index (PHSI) for June fell 0.4% month-over-month. This was better than expectations for a 1% fall.

Meanwhile, on the year, pending home sales were up 9.1%, beating expectations for an 8.3% rise.

May's numbers were revised lower to reflect a 5.8%? MoM decline and an 11.2% YoY rise. This compares with an initial reading that showed a 6.7% MoM rise and a 12.5% YoY rise.

"Mortgage interest rates began to rise in May, taking some of the momentum out of contract activity in June," Lawrence Yun, NAR chief economist said in a press release. "The persistent lack of inventory also is contributing to lower contract signings."

The 30-year rate stands at 4.31% according to Freddie Mac's primary mortgage market survey. Yun added that some homebuyers sign contracts with floating mortgage interest rates, and these can be locked 10 - 14 days before closing. "So some homebuyers may change their minds if the rate rises too much, which apparently happened with some sales scheduled to close in June."

Ahead of the report, Bank of America's Michelle Meyer expected a decline of 2% on the month. She expected some of the decline to be on accounts of a "give-back following a 6.7% surge in May."

Here's a look at the regional breakdown:

• In the Northeast the PHSI is up 12.2% from a year ago.

• In the Midwest it fell 1% on the month, but is up 19.5% from a year ago.

• In the South the index was down 2.1% on the month, but is up 9.5% from a year ago.

• In the West it climbed 3.3% on the month and is up 4.4% from a year ago.

Investors watch this number because it is considered a leading indicator of the housing market. The PHSI looks at all homes where a contract has been signed but the sale is not complete.

Here's a look at pending home sales from NAR:

NAR

Source: http://www.businessinsider.com/june-pending-home-sales-2013-7

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