What is Pending Home Sales m/m?
The Pending Home Sales m/m report doesn’t just tell us the number of homes about to be sold — it reveals much more. Traders, take a closer look at this report, and you might start to see its meaning in a whole new light.
“Pending Home Sales” refers to the number of homes in which buyers have signed a contract, but the sale has not yet been finalized or closed. In other words, these are homes where buyers and sellers have agreed on the terms, but the transaction is still pending completion.
The term “m/m” stands for “month-over-month,” which means that when we talk about “Pending Home Sales m/m,” we are looking at the change in the number of pending home sales from one month to the next.
If there is a positive percentage change in Pending Home Sales m/m, it means that more homes are under contract in the current month compared to the previous month. Conversely, if there is a negative percentage change, it indicates that fewer homes went under contract in the current month compared to the previous one.
What else can Pending Home Sales m/m tell us?
Housing Demand: An increase in Pending Home Sales m/m indicates rising demand for homes. When more buyers are signing contracts to purchase homes, it shows strong interest from property buyers.
Future Home Sales: Pending home sales serve as a key indicator of future home sales. An increase in pending sales typically precedes a rise in actual home sales in the coming months, as these pending transactions are likely to close eventually.
Market Activity: The Pending Home Sales m/m figure reflects the level of activity in the housing market, providing a real-time snapshot of how many buyers are actively engaged and making offers on properties.
Market Sentiment: Changes in Pending Home Sales m/m can also reflect shifts in market sentiment. For example, a sudden drop in pending sales might indicate uncertainty or declining buyer confidence, while an increase could signal growing optimism.
Impact on Related Industries: The housing market significantly affects related industries such as construction, real estate services, and home improvement. Monitoring monthly pending home sales can offer insights into future demand for these sectors.
Overall, Pending Home Sales m/m is a key indicator used by economists, analysts, policymakers, and real estate professionals to assess the condition and direction of the housing market and to forecast future trends.
Impact on Gold & the USD (U.S. Dollar)
If the numbers come out higher than expected, it is positive for the USD dollar.
But if the numbers come out lower than expected, gold is likely to soar.
