Summer may have been blazing hot throughout most of the country, but pending home sales continued to slowly cool off. July saw another small downturn of 1.8 per cent, according to the National Association of Realtors – a trend that began to hit most of the country in June.
The western portion of the United States remained the exception, as eager homebuyers signed on the dotted line during these months. However, all areas of the country have experienced a decline compared to years past.
Despite the dip, there still has yet to be a surplus of housing options available for homebuyers.
“The market may be starting to cool slightly, but at the moment there is not enough supply to match the demand from would-be buyers,” said Lawrence Yun, NAR’s chief economist. “That said, inventory is slowly increasing and home shoppers should begin to see more options in the coming months.
“Homes listed for sale are still garnering great interest, but the multiple, frenzied offers – sometimes double-digit bids on one property – have dissipated in most regions,” Yun said. “Even in a somewhat calmer market, a number of potential buyers are still choosing to waive appraisals and inspections.”
According to Yun, 27 per cent of customers omitted appraisal and inspection conditions from their requirements in July.
As buyers continue to reconsider purchasing in large metropolitan cities, the northeastern states experienced a downturn. The northeast PHSI fell 6.6 per cent to 92.0 in July, a 16.9 per cent decrease from 2020. In the midwestern states, the index dropped 3.3 per cent to 104.6 last month, down 8.5 per cent from last July.
Pending home sales transactions in the southern area of the country declined 0.9 per cent to an index of 130.9 in July, down 6.7 per cent from July 2020. The index in the western U.S. was the only exception. It rose 1.9 per cent in July to 99.8, but was still down 5.7 per cent from a year prior.