Home Sales Index Up

The National Association of Realtors Pending Home Sales Index for August increased 7.4% to 93.4 from an upwardly revised reading of 87.0 in July, and is 8.8% higher than August 2007 when it stood at 85.8. The index is at the highest level since June 2007 when it stood at 101.4. Lawrence Yun, NAR chief economist, said homebuyers were responding to improved affordability. "What we're seeing is the momentum of people taking advantage of low home prices, with pending-home sales up strongly in California, Nevada, Arizona, Florida, Rhode Island and the Washington, D.C., region," he said. "It's unclear how much contract activity may be impacted by the credit disruptions on Wall Street, but we're hopeful most of the increase will translate into closed existing-home sales." The index increased in all four regions of the country, but had its highest increase in the West, up 18.4%. Mr. Yun added "Home buyers in July were hampered by overly stringent lending criteria in the months before the government takeover of Fannie and Freddie. August shows some unleashing of pent-up demand before the credit crisis accelerated in September." NAR's website is http://www.realtors.org.