Pending Home Sales Surge Sparks Hope for Ailing Housing Market
Defying gravity—or at least interest rates—pending home sales just flashed their first green shoots since the Fed went nuclear on mortgages.
### The Lazarus Effect
Contracts signed but not yet closed are staging a comeback, suggesting buyers might finally be adapting to 7% rates like boomers adapted to vinyl records—grudgingly, then all at once.
### Wall Street’s Crystal Ball
Forward-looking indicators now hint that the housing market’s coma might not be terminal. Though let’s be real—this ‘recovery’ is still moving at the speed of a zoning board approval.
As always, the suits are already pricing in the rebound. Because nothing heals a market faster than hedge funds front-running actual homeowners.
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May’s pending home sales increased by 1.8% month-over-month. That came in above the estimate for a 0.1% rise and recovered from a steep 6.3% fall in April. All four U.S. regions experienced a monthly rise in pending home sales.
U.S. Wages Rising Faster than Home Prices
“Consistent job gains and rising wages are modestly helping the housing market,” said NAR Chief Economist Lawrence Yun. “Hourly wages are increasing faster than home prices.” The median home sales price is still hovering NEAR the all-time high set during the fourth quarter of 2022.
Pending home sales can act as a gauge of consumer confidence, as they are likely the most expensive purchase a consumer will ever make. If a consumer is willing to purchase a home, that signals they hold a positive view on their finances and the economic outlook. A recovering pending home sales figure bodes well for both the housing market and the stock market and helps mortgage-related companies as well.
Housing stocks are mixed on the day as the market digests the news.
