The housing market is showing strong momentum, with pending home sales increasing for the third straight month in October 2024, according to the National Association of REALTORS® (NAR). All four major U.S. regions experienced month-over-month growth in contract signings, with the Northeast leading the charge. Year-over-year, pending transactions saw a rise across the board, with the West showing the largest growth.
Key Metrics at a Glance
The Pending Home Sales Index (PHSI), a key forward-looking indicator of home sales based on contract signings, rose by 2.0% to 77.4 in October. This marks a 5.4% increase year-over-year, signaling a resurgence in homebuying activity. For context, an index score of 100 represents the contract activity level of 2001, a historically strong year for real estate.
Lawrence Yun, NAR Chief Economist, noted:
"Homebuying momentum is building after nearly two years of suppressed home sales. Even with mortgage rates modestly rising despite the Federal Reserve's decision to cut the short-term interbank lending rate in September, continuous job additions and more housing inventory are bringing more consumers to the market."
Adding to the positive trend, SentriLock lockbox openings—a measure of buyer activity—rose 7% in October compared to last year.
Regional Breakdown: Northeast Leads the Way
Here’s a closer look at the performance by region:
- Northeast: The PHSI surged 4.7% month-over-month to 68.7, marking a 7.2% increase from October 2023.
- Midwest: Contract signings climbed 4.0% to 77.8, up 1.8% year-over-year.
- South: The index edged up 0.9% to 90.0, a 2.5% annual gain.
- West: While showing only a 0.2% monthly increase to 64.1, the region recorded the strongest annual growth at 16.8%.
Yun highlighted the significance of these gains, especially in the Northeast and West, noting:
"It's encouraging to see contract signings increasing in all major regions of the country. More notable gains from a year ago occurred in the expensive regions of the Northeast and West. The record-high stock market is providing a boost for upper-end home buyers."
What This Means for NCJAR Members
For REALTORS® in North Central Jersey, these trends are promising. The Northeast's strong performance signals increased buyer activity in our region, supported by a more robust housing inventory and a thriving job market. If you're working with buyers, this is an excellent time to capitalize on renewed market interest, particularly among upper-end homebuyers who may be leveraging gains from the stock market.
As always, staying informed and proactive is key to guiding clients through these dynamic market conditions. Let’s seize the momentum!
