Index of contracts for home resales dipped 2% in May


July 10, 2005|By Bloomberg News

Contracts to buy previously owned homes fell in May for the first time in four months, while remaining close to a record.

The index of signed purchase agreements, or pending home resales, fell 2 percent to 124.9 from a revised 127.5 in April, the National Association of Realtors reported last week.

The May figure was the third highest on record. Contracts signed in April were originally estimated to have been a record 128.2. The index averaged 120.6 last year.

The report contrasts with new-home sales data, which expanded at the second-fastest pace ever in May. The level of pending resales suggests rising prices may be discouraging some prospective buyers, though homebuying remains elevated by historical measures.

The pending sales index tracks contract signings, not closings. The NAR created it in March as a leading indicator for the housing market.

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