July Pending Home Sales Down 1.8%

Pending home sales dipped modestly in July, the National Association of Realtors said Monday, marking the second straight monthly downturn.

The NAR Pending Home Sales Index (www.nar.realtor/pending-home-sales), a forward-looking indicator of home sales based on contract signings, declined by 1.8% to 110.7 in July. Year-over-year, signings fell 8.5%.

Pending home sales in the South fell by 0.9% to 130.9 in July and fell by 6.7% from a year ago. In the West, pending sales rose by 1.9% in July to 99.8, but fell by 5.7% from a year ago. In The Northeast, sales fell by 6.6% to 92.0 in July and fell by 16.9% from a year ago. In the Midwest, the index dropped by 3.3% to 104.6 in July and by 8.5% from a year ago.

“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.

The report noted as of July, 27% of buyers bypassed appraisal and inspection contingencies. By refraining from these evaluations, in most cases, Yun said, buyers are looking to accelerate the homebuying process.

“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.”