June 4th, 2009 by Michael Oliver

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Pending Home sales across the country continued there upswing across the nation pending sales were up. In fact the sales increases are up the most in 8 years! In the West pending sales are up 1.8%. Pending sales indicate that a buyer and seller have come to terms and a home is in escrow “pending” for sale. Now while a home is pending for sale lots of things can happen, inspections could come in worse then expected, buyers may not qualify for the loan even if pre-approved previously, etc. Pending sales indicate typically the actual sales numbers for the next month as this months pending sales should in a lot of cases be next months close sales.

Here in Tucson I have seen the market picking up in most areas and price ranges. The hottest segment is the foreclosure home market under 150k. Low interest rates and high affordability are playing a significant role in getting buyers to step up and buy. I think this trend should continue first time buyers are going to want to take advantage of the $8,000 tax credit to buy a home before 12/1/09. Pushing many into the market currently

There is some resistance that the other segments of the market IE: Higher price ranges, and the non-distress sales market are not nearly as hot as the foreclosure/ short sale segments of the Tucson market. I believe that this will take some time as most sellers are unwilling or unable to sell at the prices that foreclosures are touching. Eventually the foreclosure epidemic will subside (as previously written about) and a lot of buyers do not want to purchase a distress sale due to the normal “work” they require. So in my mind more sales is good regardless and as long as inventories continue to decline the overall Tucson market is getting better vs. worse. Over the past 4 months or so we have seen serious inventory declines in the Tucson market. If this trend continues Tucson should be in a very healthy, strong real estate market by next year this same time. In fact its very possible that there is a shortage of inventory within the next 18 months in Tucson as new home building is at the lowest levels in decades so new supply probably would take a while to hit the market. But for anything like this to play out foreclosures have to subside and there isn’t a lot of evidence that is happening quite yet.

Here’s a video from CNBC to further explain the pending home sales statistics: