Pending home sales drop in region and nation

Pending home sales in September fell a sharp 4.7 percent in the Philadelphia area and 4.6 percent nationally, marking a turnaround from gains in August, according to reports today.

For the 12-county local region, the September index reading of 68.2 was down from 71.6 in August, Prudential Fox & Roach reported. It also was nearly 18 percent below a year ago. The region stretches from Trenton to most of Delaware.

"We're seeing a stalled market throughout the 12 counties. Sellers are waiting to sell before they purchase" new homes, said Steve Storti, the company's senior vice president of marketing. "We're keeping an eye toward next month's index to see how big the impact of the national stock market downturn was to October activity."

In the immediate Philadelphia area, the pending sales index fell in September in seven of the eight counties - with the biggest drop, 13.0 percent, in Burlington County. The only county to show an increase from August was Gloucester, where the index was up 9.0 percent.

The real estate firm's index is based on a 2002 level of 100.

Meanwhile, the National Association of Realtors' seasonally adjusted index of pending sales for existing homes nationwide showed a reading of 89.2. That was down from 93.5 in August.

Economists surveyed by Thomson Reuters expected a September reading of 90.6.

One negative influence on buyer psychology now is the nosedive and volatility in stock prices over the last two months. That is likely to be reflected when the Realtors' group on Nov. 24 reports U.S. existing home sales for October.

Home sales are considered pending when the seller has accepted an offer, but the deal has not yet closed - typically one to two months later.

The national index for pending sales is based on a level of 100 for average sales activity in 2001.

There was a positive sign in the index nationally: It has been above year-ago levels for two straight months, though prices continued to sink.

Also, there have been sales increases in California, Florida, New York's Long Island, Boston, Minneapolis, Denver and Washington, D.C. But much of that gain likely comes from buyers snapping up foreclosed properties at discounted prices.