Media Contact: Eric Berman - 781-839-5507 - eberman@marealtor.com

July Future Indicators Report: Pending Sales Climb to Record Levels

by Eric Berman | Aug 12, 2014

Agents Say Online Pricing Tools Can Complicate Homebuying 

WALTHAM, Mass. August 12, 2014 – Pending home sales across the state climbed to their highest level for July since Massachusetts REALTORS began tracking homes under agreement in 2004. The Massachusetts Association of REALTORS® (MAR) announced the results of its July Future Indicators Report, showing a 17 percent increase in accepted offers since same time last year. Median price of accepted contracts rose nearly three percent to $360,000 during this period.

July Pending Sales:

Single-Family

July 2014

July 2013

%Change

Sales

5,339

4,554

+17.2%

Median Price

$360,000

$350,000

+2.9%

 

  • 17th straight month of single-family year-over-year increases.
  • The most homes put under agreement in July since MAR has been tracking this data.

Condominium

July 2014

July 2013

%Change

Sales

2,046

1,862

+9.9%

Median Price

$320,000

$312,000

+2.6%

 

  • The most number of condos put under agreement in July since 2005 when 2,186 units were put under agreement.

 “It’s no surprise to see buyer demand continue its strong pace into the second half of the year,” said 2014 MAR President Peter Ruffini, regional vice president at Jack Conway & Co. “Combined with the fact that new listings to the market were up significantly in June, this should translate into good year-over-year sales numbers for July.”

REALTOR® Market and Price Confidence Indexes:
 

Confidence Index

July 2014

July 2013

%Change

Market

63.54

71.09

-11%

Price

70.69

72.27

-2.0%

  • The ninth straight month that the RMCI has gone down.
  • The sixth straight month that the RMCI has been over the 60-point mark.
  • The fourth straight month that the RPCI has gone down.
  • The 17th straight month the RPCI was over the 70-point mark.
  • Measured on a 100-point scale, a score of 50 is the midpoint between a “strong” (100 points) and a “weak” (0 points) market condition.    

“REALTORS® confidence in the market is holding rather steady compared to last month, but down from July of last year,” said Ruffini. “Pending sales continue to go up, but closed sales haven’t follow suit as keeping deals together can be challenging. This is having a little bit of a negative impact on the overall feeling about the market.” 

Monthly ‘Hot Topic’ Question:
In response to the Association's monthly “Hot Topic” survey question, 44 percent of REALTORS® reported that automatic pricing estimates on various online sites are complicating home purchase transactions. However, some 30 percent reported that the availability of this data made the transaction “somewhat easier”, and 21 percent reported it made no impact.

“There are plenty of online resources available to consumers looking to buy or sell real estate, and that can be a good thing from an educational standpoint,” said Ruffini. “However, there are still plenty of issues with the accuracy of much of the information available, especially with regard to automated valuation models which are popular with consumers. REALTORS® have the expertise and local market knowledge to guide consumers through the process of buying and selling real estate.”

About the Data Sets:

Pending sales - The tracking of signed purchase and sales agreements (also called “pending sales”) provide reliable information about where the real estate market is heading in coming months. 

A pending sale or a sale “under agreement” is when the buyer and seller agree on the terms of the sale of a home and have a signed purchase and sale agreement, but have yet to close and be recorded as such.  MAR is the only organization which compiles this statewide information from Multiple Listing Services each month.

Monthly pending (or under agreement) data and closed sales data comes from the three REALTOR®-affiliated Multiple Listing Services in Massachusetts. They are the Berkshire County Multiple Listing Service, Cape Cod & Islands Association of REALTORS® Multiple Listing Service, Inc.; and MLS Property Information Network, Inc. The data is compiled by 10K Research and Marketing, Inc. and updated each month. As a result, previous data may change after the reports have been run.

 
The REALTOR® Index Methodology -
The Massachusetts REALTOR® Market Confidence Index (RMCI) and Price Confidence Index (RPCI) are based on monthly responses from a random sampling of Massachusetts Association of REALTORS® members on the state of the housing market.  More specifically, the survey asks members two basic questions pertaining to the real estate business in their market area in Massachusetts.

  1. How would you describe the current housing market?
  2. What are your expectations of home prices over the next year?

 In addition to these standard questions, the survey each month includes one wildcard question that changes each month and is based on an industry hot topic.

The RMCI is calculated in the following way.  Respondents indicate whether conditions are, or are expected to be “strong” (100 points), “moderate” (50 points), and “weak” (0 points).  The results are the average score for each question.  A score of 50 is the threshold between a “strong” and a “weak” condition.  Similarly, the question about home prices over the next year (REALTOR® Price Confidence Index) is calculated using five categories: “Rise 0-5%” (75 points), “Rise 5%+” (100 points), “Level” (50 points), “Fall 0-5%” (25 points), and “Fall >5%” (0 points).

About the Massachusetts Association of REALTORS®: 

Organized in 1924, the Massachusetts Association of REALTORS® is a professional trade organization with more than 19,000+ members.  The term REALTOR® is registered as the exclusive designation of members of the National Association of REALTORS® who subscribe to a strict code of ethics and enjoy continuing education programs.

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Editors and reporters: Please note that the term Realtor is properly spelled with an initial capital “R”, per the Associated Press Stylebook.