The number of new home sales contracts signed across the United States soared due to healthy employment gains and low mortgage rates.
Pending home sales increased 14.5% year over year and 0.2% month over month, according to the newly launched New Home Pending Sales Index (PSI) from Meyers Research.
“The US housing market regained momentum this year after a tough close to 2018,” said Ali Wolf, director of economic research at Meyers Research. “October’s new home sales capture stronger demand as lower mortgage rates, softer home price appreciation, and positive wage trends favor buyers.”
Seven of the 10 key markets saw annual growth, and six experienced monthly gains. Seattle, Phoenix, and Dallas were the top three markets with the most significant growth, up 36.2%, 31.1%, and 24% from October last year.
Meanwhile, sales in San Francisco slowed in the second half of 2018 and are yet to fully recover. sales were 0.4% lower year over year in October, compared to -7.3% in September.
“Consumer confidence is the lifeblood of the housing market,” Wolf said. “Right now, we are seeing more shoppers encouraged by their employment situation and feel there’s value in buying a home today with rates sub-4.0%. As a result, the housing market in 2019 is expected to be the best of this expansion.”