Hello neighbors,

According to the National Association of Realtors, pending home sales took an anticipated dive after the expiration of the home buyer tax credit.

The Pending Home Sales Index experienced a 30% drop to 77.6 based on contracts signed in May 2010 in comparison to April's number of 110.9. In addition, this number is 15.9% below May 2009's average of 92.3.

This data from the NAR is actually based on contracts and not closings. However, many closings have been delayed due to factors such as a rush of buyers due to the tax credit and the dragging process of short sales. Approximately 180,000 buyers who signed contracts by April 30th may have missed the tax credit deadline's closing date of June 30th, however a recent extension from Congress will expand the closing deadline for delayed contracts.

Some industry experts feel there's a good chance for prices to start accelerating in the upcoming years if the already existing low levels of new home construction continue for the next year or two.

Stats:

The PHSI in the Northeast fell 31.6% to 67.0 in May and is 14.8% lower than May 2009. In the Midwest the index dropped 32.1% to 70.8 and is 20.2% below a year ago. Pending home sales in the South fell 33.3% to an index of 82.5, and are 14.4% lower than May 2009. In the West the index declined 20.9% to 85.3 and is 15.1% below a year ago.