October proved to be a terrible month for new-home builders, but apparently demand for existing homes only slipped slightly that month.
According to the National Association of Realtors (NAR), the Pending Home Sales Index, which measures contracts signed for existing homes, dipped just 0.6 percentage points on a monthly basis in October to a reading of 88.9. That stands only 0.9 percentage points—or 1%—below October 2007.
"Despite the turmoil in the economy, the overall level of pending home sales has been remarkably stable over the past year, holding in a generally narrow range," said Lawrence Yun, NAR's chief economist. "We did see a spike in August when mortgage conditions temporarily improved, which underscores two things: there is a pent-up demand, and access to safe, affordable mortgages will bring more buyers into the market."
Regionally, the South performed the best in October, with a 7.8% increase compared to September numbers, to a reading of 95.9. The Northeast also saw a marginal (0.6%) uptick to a 68.1 level, but both the Midwest (down 4.3% to a 79.7 reading) and West (down 8.7% to a reading of 103.7) reported declines compared to the previous month.
Alison Rice is senior editor, online, at BUILDER magazine.