The NAR Reports Housing Sales Agreement Index Dropped in July

The National Association of Realtors recently announced that its index of sales agreements fell to 89.7 in July, 2011, down 1.3 percent from the previous month.

- Sep 08, 2011 - The National Association of Realtors recently announced that its index of sales agreements fell to 89.7 in July, 2011, down 1.3 percent from the previous month. A reading of 100 is considered by real estate professionals to be a healthy market. There is normally a lag of about one to two months between the time a sales agreement is signed and the actual closing of the home being purchased. On top of this decline in sales agreements there has been another factor dragging down the market. During this two month interlude before closing the deal, housing prices have continued to drop in many areas of the country, and some people are backing out of their agreements because the value of the home is worth less than the amount they bid for the property. Although the sales agreements index is normally a reliable indicator for actual housing sales a few months out, it is now less reliable because prices of homes continue to fall around the country, and buyers are backing out of deals. Dragging down prices is the high number of foreclosed homes. These are slowly being sold and cleared off the market, but there is still a long way to go. In fact there is currently no end in sight for getting foreclosure levels back to normal. It was recently reported that about 8% of home loans had at least one payment that was late in Q2 2011. Economists consider a figure of slightly above 1% to be normal, so it is clear many people are still struggling to keep up with their payments, and consequently more foreclosures are on the way. Good information about home ownership in general and the Colorado market in particular can be accessed at http://homesforsalemonumentcolorado.org.