Pending Home Sales are Still Strong and Homes Continue to Appreciate

The National Association of Realtors (NAR) reported that Pending Home Sales, which reports on signed contracts, has increased from 1.1% to 2.8% for the month of June.  The index associated with this report was released at 108.3 which jumped from May’s 105.4.  Any level over 100 is seen as very strong and expansionary.  Again, since this reports on just signed contracts and not closed deals, this is a great indicator of future existing home sales.  A jump like this points to the fact that there is continued demand for existing homes.  Even though homes are appreciating in price, very favorable interest rates are helping to keep monthly payments affordable and homeownership very attractive.

Speaking of home price appreciation, Case-Shiller reported that for the month of May, national home prices rose by 3.4% annually. This is down slightly from its last report for April of 3.4%, but still a very strong number.  There are certainly pockets of higher or lower appreciation, but it is evident when inventories tighten up and demand stays strong, homes increase in value. 

With the current market conditions, we need to analyze each market, factor in these aggressive interest rates and determine the estimated amount of wealth that is to be made on each transaction.  Please contact your Advisors Mortgage professional today to start working the numbers and to learn the true value behind your very important transaction. 

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