Pending home sales – an indicator of how the market will fare in a few months – tell us today that there's plenty of momentum going into spring this year. In a widely distributed report from the National Association of Realtors, pending home sales rose in January, and have improved on an annual basis for 21 months.
NAR's Pending Home Sales Index tracks contract signings, not closings – making it a fair indicator of number of sales coming down the pike. The index increased 4.5% to 105.9 in January from 101.3 in December and 9.5% from the same month a year ago when it was 96.7.
The index was the highest in January since April 2010, just before the deadline for the federal home buyer tax credit when it hit 110.9.
Also, California released a pending sales index last week, showing pending sales climbed 23% to 101.4 in January from the previous month, according to the California Association of Realtors.
It's safe to say that the spring buying season will be hot in many markets this year.
In another bit of news, along with sales, asking prices seem to be following. This past week, asking prices of homes for sale that appear on Trulia were up in 90 of the 100 largest U.S. metros in February.
Roughly 4.5 million for-sale and for-rent properties were listed on Trulia through February 28. Asking prices for those homes were up 7% from a year ago, and grew at a seasonally adjusted rate of 1.4% from January to February – the biggest month-over-month gain since the housing downturn began.
Spring historically is one of the hottest periods of the year for home sales. In 2013, we’re gearing up to see one of the most active spring seasons since the recession hit.
This is great news for sellers. For buyers, it could mean a lot more competition in the market – especially for those markets that still struggle with low inventory. My advice is to be prepared with financing so you can move fast when the right home comes along, and be persistent.