Gotta love this NAR report - "pending cancellations" is a better name. But the interesting thing about it besides the 8.5% decline from a year ago being spun as good news by the MSM is Lereah saying (honestly?) that March and April are going to suck. That means he's already hearing from his ramen-eaters that the market is dead, nobody's getting paid, poor people and liar's can't get loans, and homes didn't sell in March.
NAR: WASHINGTON, April 3
A forward-looking index based onpending home sales indicates that bad weather, and possibly the loss ofsome subprime lending, will dampen sales closed in March and April,according to the National Association of Realtors(R).
The Pending Home Sales Index,* based on contracts signed in February,stood at 109.3 -- down 8.5 percent from February 2006 when it reached119.4, but is 0.7 percent higher than a downwardly revised reading of 108.5in January. Earlier, mild weather caused the index to spike at 113.3 in December.
David Lereah, NAR's chief economist, said there has been a steady narrowing from year-ago readings since last July.
"If it wasn't for theunusually bad weather in February, we'd be seeing a better performance inpending home sales," he said. "We also may be seeing some fallout from a decline in subprime lending, but a slight improvement in the more volatile month-to-month index is encouraging -- the data suggests an underlying stabilization is taking place in the housing market, but it will take another month or two to clarify."
"Problems in the subprime mortgage market will become more apparentover time, and they will modestly depress the overall level of improvement in existing-home sales we expect as the year progresses," Lereah said.
The index is a leading indicator for the housing sector, based onpending sales of existing homes. A sale is listed as pending when thecontract has been signed but the transaction has not closed, though thesale usually is finalized within one or two months of signing.
