NAR US Pending Home Sales Report Shows 4.0% Increase in August

A softer landing rather than stagflation?

A significant upside surprise that powerfully refutes the idea of a widespread slowdown. The 4.0% m/m increase in contracts signed is a massive beat against a consensus forecast of a -0.4% decline and the prior month's +0.2% reading. This is one of the strongest prints of the year for this series and, as a leading indicator for Existing Home Sales, it signals underlying momentum is carrying into the fourth quarter.

Coming on the heels of last week's strong GDP, Jobless Claims, and Durable Goods data, this report is cementing the narrative of a resilient US economy. It demonstrates that consumer strength is not limited to services but extends to big-ticket, interest-rate-sensitive purchases. This print is exactly the kind of data that vindicates the Fed's decision to maintain its' cautious, "higher-for-longer" stance. It shows the economy can withstand the current level of rates without collapsing, giving the hawks on the committee significant ammunition to argue against premature or aggressive easing.

NAR's Chief Economist directly attributes the strength to "lower mortgage rates." This shows that the economy is responding rationally to changes in financial conditions. A slight easing in rates is producing a measured pickup in activity, which is the textbook definition of a soft landing, not an uncontrolled boom. Unlike backward-looking GDP revisions, this is a forward-looking indicator for activity in the next 1-2 months. It suggests the resilience seen in Q2 and Q3 will not fade as we enter Q4.

It's been an odd couple of weeks print-wise, I'll grant you that.

4% from 0.2 forecast and previous -0.3% - 0.25% (lower mortgage rates).
Fishy numbers to me, IMO only. so strange.

This was my thinking too, pending sales may be being driven by private equity rather than ordinary consumers, as the NAR Pending Home Sales Report doesn't distinguish between types of buyers. The Existing-Home Sales Report (which tracks closed sales) does include data on first-time buyers and the share of investor/second-home buyers, however again this doesn't distinguish between sole landlords and private equity, etc.

NAR conducts other research and surveys that specifically look at the impact of institutional buyers, but I haven't had a chance to look at them yet - definitely an avenue that needs exploring.

Can you say INVESTORS?

There was a huge pent up demand from people waiting years to get a better mortgage rate. Obviously many of them jumped at the chance. 30 rates went from 7 to a little below 6%, and many agents will tell you the below 6 number is enough to get people to act. But since rates have bounced slightly, I’d assume future housing numbers will show an obvious slowdown from this. Honestly it’s not that hard to understand if you actually live in the US and pay attention. Constantly saying every news release is “fake” is just the tears of a failed trader, stop trading and do something productive with your life before your wife leaves you for losing her money.

It'd be nice to know who's "buying" all these million dollar homes on 80k average incomes....then again....that's what got us to where we are...Frankly I think reality is about to knock someone in the mouth soon.

It's time to grow up and see the data for what it is. An instrument to keep the poor in the unknown (lies, deceptions), while they're getting richer. Central banks suggesting 2% inflation for years now, meanwhile they are hoarding gold like never seen before.

Grow up folks, it's time... these numbers are all fuc'ing lies! You know it, but just afraid to admit it. Remaining willfully ignorant, because it's easier. And then, when we get somewhat close to real numbers, people will be left in shock and awe. They "couldn't" have seen it coming...

Btw, any predictions for JOLTS tomorrow? We're seeing a lot of tariffing which might be a panic reaction to a slowdown in hiring. I'm seeing whisper numbers around 7.05M.

Question is how much we can trust the numbers, I guess.

If it comes in below 7M, could be quite a wallop. A lot easier to trust bad numbers.

If it comes in above forecast, I don't know how much the market will trust it.

4.0% My eyes are watering. So when the real numbers come out who's going to get blamed? Auto pen or another sacking of a statistician?

A good thing to look at is consumer confidence, approval numbers on the economy and inflation, and JOLT. Hopefully this print will trickle down and a deep recession will be averted.

What is a bit worrisome is that Trump is going to go full R* on the economy and then use the shutdown as an excuse.