Some of the first decisions consumers made as spring kicked off this year were to sign papers so that they could finally assume the role of homeowner, newly released statistics indicate.
According to the National Association of Realtors, the Pending Home Sales Index - which takes into account the number of real estate contract signings there were in a given month - increased 1.5 percent in March to 105.7. That's 7 percent ahead of where the PHSI was at this time last year.
On a regional basis, the PHSI showed similar sustainability. For example, in the Northeast, the measure was 6.3 percent higher than it was at this time last year, while in the Midwest, the index ticked upward by three basis points. Meanwhile, in the South and West, the PHSI rose just under 3 and 1.5 percent on annual basis, respectively.
Lawrence Yun, NAR chief economist, pointed out that the PHSI actually could have been much higher last month, were it not for limited supply. However, as more jobs become available and housing demand continues to persist, more opportunities for homeownership should develop as inventory levels are replenished.
"Little movement is expected in near-term sales closings, but they should edge up modestly as the year progresses," said Yun. "Job additions and rising household wealth will continue to support housing demand."
Construction firms see sales success
As conditions stand already, home builders have been hard at work, based upon the pace of home purchases and real estate inquiries. Data compiled by the Wall Street Journal reveals that for home construction firm PulteGroup, the company witnessed a 35 percent increase in the number of properties people purchased that it developed. In addition, the average price these homes went for was $287,000, approximately $26,000 ahead of where conditions were in the corresponding first quarter of 2012.
Several other home building firms were in the black through the first three months of 2013. The newspaper notes that Arizona-based constructing company Meritage Homes saw sales swell 17 percent from January to March, with the average sales price finishing at $336,000 - 25 percent north of where the company was over the same period last year.
Not to be outdone was the California-headquartered construction firm Ryland Group. Among properties that the company finished and that prospective homeowners closed on, the average price of these properties was $277,000 this year, 8.2 percent north of where its numbers were during the equivalent three-month stretch of 2012.
Patience to be rewarded
Nevertheless, there are still many properties that have yet to be finished, and prospective homeowners are anxiously awaiting their completion. Jed Kolko, chief economist for the real estate information website Trulia, said that soon-to-be homebuyers should exercise restraint - as restless as they may be to take up residence in their very own home.
"Imagination [is necessary] in order to picture what the unfinished home they're bidding on might look like, and patience because they won't be moving into that unfinished home tomorrow," Kolko recently wrote in a research note.
And a big part that's played in getting a residence's eventual owners into their place as quickly as possible is having a home inspection done. A pre move-in home inspection essentially puts the finishing touches on a new construction project that both the soon-to-be homeowner and construction firm rely on. Using myriad criteria that establish whether or not the home is up to code, this process is a critical step in the homebuying process, indicating whether a home is safe to live in and at the same time providing appraisers with the background information they need to better determine it's market value.