The housing market took a step back in February, but remains near post-recession highs.
According to data from the National Association of REALTORS®, February’s Pending Home Sales Index slipped 0.5 percent from the month prior, to 96.5.
The Pending Home Sales Index is a monthly report which measures the number of homes under contract to sell, but not yet sold, nationwide.
The index is benchmarked to a value of 100, the average level of home contract activity in 2001, the first year that pending home sales data was analyzed. It also happened to be a year of historically-high levels of home contract activity. Therefore, a Pending Home Sales Index reading of 100 suggests a strong housing market nationwide.
The index has read north of 90 since October 2011.
On a regional basis, February’s Pending Home Sales Index varied :
- Northeast Region: -0.5 percent from January 2012
- Midwest Region : +5.7 percent from January 2012
- South Region : -3.3 percent from January 2012
- West Region : -2.6 percent from January 2012
Mild weather may have helped the Midwest Region last month but even regional data can only tell us so much. Like everything in real estate, housing data must be local to be relevant.
Throughout the South Region, for example, the area in which contract activity fell most on a monthly basis, there are states which performed better than the regional average, and states which performed worse. Furthermore, even within those states, there are some cities which over-performed, and others which underperformed.
It’s why we can’t put too much stock in national housing news. Buyers don’t buy nationally — they buy locally.
Today’s home buyers and sellers in Chicago , therefore, should look beyond the national Pending Home Sales Index and into local market drivers. The Pending Home Sales Index can paint a broad picture of the U.S. housing market but for data that matters to you specifically, it’s not as widely helpful.
To get relevant, timely local real estate data, talk to a real estate professional.