New Home Pending Sales Up in September

New home pending sales were up for the second month in a row, according to Zonda Economics’ New Home Pending Sales Index.

• M-O-M: The New Home Pending Sales Index was up 5.9% to 113.2 in September.

• Y-O-Y: The index is down 25.9%when compared to the same month last year.

Top Markets. Minneapolis took the top spot with a 22.3% increase month-over-month in September followed by Seattle “(+17.4%) and Washington, DC (+16.8%)

• On a yearly basis, Baltimore took the top spot being the only market in positive territory with 14.1% growth followed by Raleigh (-4.0%) and Cincinnati (-6.7%).

The Worst. San Francisco had the biggest year-over-year collapse with a 64.9% drop in September followed by Phoenix (-61.3%) and Sacramento (+54.1%).

Prices. National home prices increased year-over-year across entry-level, move-up, and high-end homes. Prices rose 12.7% for entry-level to $340,369, 10.8% for move-up to $529,050, and 8.7% for high-end homes to $906,157. High-end price growth increased to a new high.

• Entry-level homes were up 0.06%, move-ups were up 0.22%, and high-end homes were up 1.1%.

Analysis. Ali Wolf, Zonda’s chief economist. says an equilibrium has not yet been reached. “We are on a quest to find what we’ll call the strike price – a price where consumers see the value in the home and/or community and re-enter the market…Right now, consumers are both uncomfortable with where prices are, and in many cases, unable to make the math work. Strategic price cuts and incentives are sometimes proving effective at pulling back in some of the skittish consumers. In other cases, the quest carries on.”