Steep Fall In Pending Home Sales

Existing home sales, in sharp contrast to new home sales, haven't been able to build any strength this year and today's pending home sales report points to outright weakness in the coming months. The pending index fell a very steep 2.4 percent in August with 3 of 4 regions positing monthly declines. The exception is the Northeast which rose 1.3 percent in the month and is the only region in the plus column for the year-on-year rate, at 5.9 percent. But this report is not about strength but weakness, weakness that persists despite very low mortgage rates and strength in the labor market.

Recent History Of This Indicator:
Pending home sales had been weak this year but rose a sharp 1.3 percent in July to signal needed improvement in final sales of existing homes which have been flat. Forecasters see pending sales slowing only modestly from July jump, to a consensus plus 0.5 percent in August.