Economists, analysts, and the alike have given the expanding rise in housing prices and activity a lot of credit for bringing the US economy out of recession while adding additional growth. Unfortunately, housing sector indicators have deteriorated since going into the winter months (pre-polar vortex). So, how’s the housing sector now? Still not good.
Contracts to purchase previously owned homes fell in February for the eighth straight month, a streak which cannot be blamed on poor weather. Pending homes decreased .8 percent, following a .2 percent drop in January, according to the National Association of Realtors (NAR). January’s figure was revised down from a .1 percent gain, and analysts were forecasting a .1 percent increase this month. Contract signings fell 10.2 percent year-over-year on a non-adjusted basis, the most since April 2011.
However, no matter the data trends, economists are still seeing weather as a scapegoat. “For housing, it’s been primarily an issue of bad weather,” said Ameriprise Financial senior economist Russell Price. Just curious, what about June to November?
A historical chart of pending home sales shows a declining index since 2007. Notice the top formed in late 2011 and mid-2012, and then it just putters pathetically until it collapses below the trend. The six-year data sample shows that sales would have to dip to -20 to -25 before seeing a substantial move forward.