The data emphatically shows the housing market keeps on getting stronger this spring.
After last week’s report on existing-home sales rising 1.7 percent in April, we announced this morning that pending home sales (signed contracts) last month jumped 5.1 percent to an index reading of 116.3.
The last time the index was this high (February 2006; 117.4), Phoenix Suns point guard Steve Nash was on his way to winning his second Most Valuable Player award, Beyonce’s “Check On It” was the number one hit on the Billboard 100, and Shaun White won a gold medal in the Men’s Halfpipe competition at the 2006 Winter Olympics in Turin, Italy.
In other words, despite ongoing supply constraints and affordability concerns, it’s been a long time since the housing market has seen this many buyers signing the dotted line to purchase a home.
Can the trend continue? Lawrence Yun, NAR chief economist, thinks so. Even if mortgage rates rise soon, as expected at some point once the fading effects of last year’s cheap oil on consumer prices edges up inflation, he says sales have legs for further expansion heading into the summer. They key denominator is supply needs to at least come close to meeting the pent-up demand in many markets.