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Pending Home Sales Report, February

The Pending Home Sales Report for February was issued on Wednesday.  Here's a quick summary:

Overall, the pending home sales index was up 2.1% from January but is 1.4% below last year.  Here's how it breaks out by region:

  • Northeast: Up 11% but still 11% below last year
  • Midwest:  Up 15% and 3% higher than last year
  • South:  Up 4% and flat with last year
  • West:  DOWN 14% and 2% lower than last year

After all the froth out West, it looks as if that market is taking a breather.  

The other metric measured in this report is home affordability.  This index has SKYROCKETED to a record since the data began in 1970.  Now, the median household earning $60,000 can afford a $286,000 home with 20% down and a ceiling of 25% of income dedicated to housing payments.  As the median home is now priced at $165,000 there are enormous buying opportunities for families.  First time purchasers get an additional $8,000 tax credit making the homes even more affordable.

Of course, many families are under water in the homes they now own and can't move.  But those who can afford to move are seeing historic buying opportunities.  The home supply will increase now through June or July, and then begin to contract as we leave the busy season.

Here's the full story.