August Pending Home Sales (contract signings), rose 6.4% m/o/m, well above estimates of a gain of 1% with all 4 regions seeing gains led by the West (has seen most of the foreclosures). The chief economist of the NAR summed up the boost by saying “no doubt many first time buyers are rushing to beat the deadline for the $8,000 tax credit.” He also said that while buyers are returning, “deals are not necessarily closing because of long delays related to short sales, and issues regarding complex new appraisal rules.” He also admitted that there is some double counting over a span of several months “because some buyers whose contracts were cancelled have found another home and signed a new contract to buy.” He doesn’t know how many transactions are being delayed and how many are being cancelled. Bottom line, the fate of the tax credit is the most important issue now facing the industry.
