Pending Home Sales Show Modest Improvement, but Market Remains Subdued
The National Association of REALTORS® reported today that pending home sales increased by 2.0% in February 20251. However, this modest gain comes with some caveats:
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Year-over-year decline: Despite the monthly increase, pending transactions are down 3.6% compared to February 2024.
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Regional variations: The Northeast and West saw month-over-month decreases in transactions, while the Midwest and South experienced gains, with the South showing the largest improvement.
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Below historical norms: NAR Chief Economist Lawrence Yun noted that “contract signings remain well below normal historical levels”.
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Interest rate impact: Yun emphasized that a significant decrease in mortgage rates would boost both demand and supply in the housing market.
This news indicates that while there’s some positive movement in the housing market, challenges persist. The slow pace of home sales suggests a potentially subdued spring selling season, traditionally the busiest time for real estate transactions4.
For potential buyers and sellers, this mixed market presents both opportunities and challenges. Buyers may find slightly more options and negotiating power, while sellers need to price competitively and consider offering incentives to attract buyers in this environment.