Surprising Good News In Pending Home Sales

A gauge of future home sales took a surprising jump in August, a positive sign amid the sluggish housing market, but perhaps coming too late in the current financial crisis.

The National Association of Realtors (NAR) reported Wednesday that pending sales of previously owned homes rose 7.4% over July 2008. Pending sales figures are based on contracts signed by homebuyers in August. The transactions typically close a month or two after signing.

Analysist note that the increase is most likely due to investors snapping up heavily discounted foreclosed homes.

The median price for an existing home nationwide is now $200,700. It was $218,900 in 2007, a drop of nearly 10 percent.

By region, pending sales in the Midwest rose an average of 3.6%. While it is a small increase, the NAR had earlier estimated a 3.2% decline. Source NAR and Wall Street Journal.