Philadelphia area beats U.S. in pending home sales

The eight-county Philadelphia region outperformed the nation as the number of home-purchase agreements signed here in July rose 8.8 percent from June, according to figures out yesterday.

However, the Prudential Fox & Roach HomExpert Pending Sales Index, based on Trend Multiple Listing Service data, was down 21.2 percent from July 2007.

Only Bucks County showed a month-to-month decline. The index for the three South Jersey counties - Camden, Burlington and Gloucester - reached the highest level since January.

By contrast, the National Association of Realtors Pending Home Sales Index fell 3.2 percent month-to-month and 6.8 percent from July 2007.

Pending home sales are oscillating, "with the long-term trend essentially flat," said the NAR's chief economist Lawrence Yun.

Yun's gloomy forecast contrasted sharply with the elation the real estate industry had been expressing since President Bush signed what was described as a "sweeping" housing act at the end of July designed to give the flagging market a major boost.

One provision of the act paved the way for Sunday's takeover of mortgage giants Fannie Mae and Freddie Mac. Since then, 30-year fixed-mortgage rates have fallen half a percentage point, to less than 6 percent.

The consumer response has not been overwhelming.

"My phone hasn't been ringing off the hook," said Philadelphia mortgage broker Fred Glick.

Prudential Fox & Roach agent Jeff Block was working Sunday when the takeover was announced.

"There actually was no mention of Fannie or Freddie, though my general impression is that buyers do not know what it means yet," Block said.

Moody's Economy.com chief economist Mark Zandi said he expected refinancing activity to pick up more quickly than mortgage applications, adding that, "while all these policy steps are helpful, they are being overwhelmed by job losses."

Peter Buchsbaum, of Arlington Capital Mortgage Corp. in Jenkintown, described the government's action as "a beginning," but added that "the problem, unfortunately, is not rates, but a combination of confidence and ability to finance a high percentage of the purchase price."

The typical borrower is not looking for a "cheap mortgage," Buchsbaum said, "but to part with as little a down payment as possible."

Index levels based on 2002 = 100.

%

County          June       July       change

Bucks          75.2      70.1       -6.9

Burlington       57.6      59.4       +3.1

Camden          58.0      65.4       +12.9

Chester          60.0      72.7    +21.2

Delaware       70.3      74.5       +6.0

Gloucester       57.7      76.3       +32.2

Montgomery    70.0      72.1       +3.0

Philadelphia    85.4      91.1       +6.6

Eight counties    66.8      72.7       +8.8

SOURCE: Prudential Fox & Roach HomExpert Report