December’s Meyers Research New Home Pending Sales Index, out Thursday, shows that new home contracts are 12.5% stronger than last year when adjusting for supply and seasonality.
2019’s housing market ended on a positive note with nine of ten key markets growing year-over-year, capturing a strong rebound from the slow second half of 2018.
The Index shows a 117.5 for December, representing a 12.5% increase from December 2018. On a month-over-month basis, new home sales decreased by 2.5% between November and December 2019. The national index is 2.5% higher than December 2017.
Markets driving the increase in new home pending sales:
- Los Angeles, San Francisco, and Seattle experienced the most significant growth compared to last year, up 33.4%, 32.4%, and 31.5%, respectively. Context is key, however. Sales in these three markets are lower than two years ago.
- San Francisco and Orlando were the only markets to increase month-over-month in December.
- Home sales in Denver and Houston are tracking just below their cycle-high. Both markets are up year-over-year and on a two-year basis.
“Looking ahead, a heated election year, slowing global growth, and housing affordability concerns will be top-of-mind for buyers,” said Ali Wolf, director of economic research at Meyers Research. “There’s still a desire to own a home, especially for millennials, but we need to keep our eyes on how confidence trends in the early-months of 2020.”
