Pending Home Sales Up 7.4 Percent, 18.4 Percent in West

This is good news as the combination of lower prices, low interest rates, and pent up demand may be coming to a head.

Pending homes sales in a report issued by the National Association of Realtors are up 7.4 percent in August compared to July, 2008. The numbers are up 8.8 percent over August, 2007.

While it is not time to crack open the champagne bottles, it is a sign that consumer demand and pricing are finding an equilibrium. Now we need to hope that the other external forces in the economy do not drag down the momentum that seems to have been built.

But after the meltdown on Wall Street does real estate look like the better investment now?

Pending home sales for August rose in all four of the regions tracked by the NAR.

Gains amounted to 18.4% in the West, 8.4% in the Northeast, 3.6% in the Midwest and 2.3% in the South.

July’s pending home sales index was revised to a decline of 2.7% from a prior estimate of a 3.2% decrease.

NAR says pending home-sales activity rose because of buyers taking advantage of low prices and affordable interest rates. August’s results show an “unleashing of pent-up demand” before the credit crisis worsened in September, Yun said