Pending home sales reach new low; The bad news keeps coming
Anyone hoping that 2009 would bring good news regarding the housing industry was undoubtedly disappointed by the latest research report released by the National Association of Realtors. The report, the Pending Home Sales Index, basically confirms what most analysts have feared: The housing slump still has a ways to go before it runs its course.
The Pending Home Sales Index, a forward-looking report based on sales contracts signed in November, fell 4 percent. That figure is now the lowest since the association began publishing the report back in 2001.
What’s the report mean? Basically, that people aren’t buying a lot of houses. Of course, that’s not exactly a secret these days, just ask anyone who’s had their home on the market for months without receiving a solid offer.
Lawrence Yun, the association’s chief economist, wasn’t surprised by the grim numbers. He pointed to rising job losses and weak consumer confidence as the reason that fewer home buyers signed contracts in November. Yun also warned that the index could continue falling as long as the nation’s economy continues its struggles.
Yun also took the opportunity to encourage the federal government to pass a housing-based stimulus package to help jumpstart the moribound housing industry. His reasoning was that if the housing industry perked up, it would lead to more consumer confidence, more wealth and a quicker end to the national recession.
These days, it’s easy to forget just how much of a boost the housing industry once gave to the national economy. During the housing boom, which lasted from about 2001 through most of 2006, everyone seemed to be getting wealthy thanks to housing prices that increased too high too quickly. Those days are long gone, of course.
When are the good-old days coming back? That’s the question everyone is asking. Too bad no one has a good answer.
