by Calculated Risk on 2/27/2023 10:05:00 AM

From the NAR: Pending Home Sales Improved for Second Straight Month, Up 8.1% in January

Pending home sales improved in January for the second consecutive month, according to the National Association of REALTORS®. All four U.S. regions posted monthly gains but saw year-over-year drops in transactions.

The Pending Home Sales Index (PHSI) — a forward-looking indicator of home sales based on contract signings — improved 8.1% to 82.5 in January. Year-over-year, pending transactions dropped by 24.1%. An index of 100 is equal to the level of contract activity in 2001.

“Buyers responded to better affordability from falling mortgage rates in December and January,” said NAR Chief Economist Lawrence Yun.
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The Northeast PHSI rose 6.0% from last month to 68.7, a decline of 19.8% from January 2022. The Midwest index grew 7.9% to 83.3 in January, a drop of 21.1% from one year ago.

The South PHSI increased 8.3% to 99.2 in January, dipping 24.7% from the prior year. The West index elevated 10.1% in January to 66.2, diminishing 29.3% from January 2022.
emphasis added

Expectations had been for a 1.0% increase for this index. Note: Contract signings usually lead sales by about 45 to 60 days, so this would usually be for closed sales in February and March.