Pending Home Sales Index (NAR)
The trailer before the movie: signings lead closings by 1–2 months — for housing direction, read the contract ledger first.
Monthly (10 AM ET, last week)
What it is
The Pending Home Sales Index (PHSI), published monthly by NAR, counts signed contracts (not closings) on existing homes, indexed to 2001 = 100. Since signings precede closings by roughly 30–45 days, the PHSI leads existing-home sales by 1–2 months — the standard forward gauge for the closing-based print. Monthly rates swing widely (±5% single months are common) and it reacts to mortgage-rate changes within the same month.
Release schedule
| Item | Details |
|---|---|
| • | Frequency: monthly (prior-month signings) |
| • | Release: last week of the month at 10:00 ET (23:00/00:00 Beijing time, DST-dependent) |
| • | Contents: the signed-contract index (m/m + y/y) — national plus four census regions |
| • | Frame: contract signings, indexed to 2001 = 100 |
| • | Transmission: signing → closing, leading existing-home sales by 1–2 months |
Why it matters
The entire value is the timing gap: it is the earliest monthly demand read on the housing chain — a mortgage-rate change shows up in the same month's signings, while closings take 1–2 months. Uses: forecast next month's existing sales (turning a lagging print into quasi-real-time); detect cancellations via the divergence between signings and subsequent closings (strong signings, weak closings = rising cancellation/financing failures). The soft spots: monthly noise and an index (not units) frame.
Impact across assets
Typical impacts (using a big beat):
| Asset | Typical impact |
|---|---|
| US equities | A beat gives housing-chain names a short-term bid; the "housing stabilizing → resilience" read is neutral-positive; elasticity below hard data |
| US Dollar Index | Mild — a housing leading index has almost no direct FX elasticity |
| Gold | Limited same-day impact; the meaning is medium-term "housing inflection" narrative validation |
| Crypto | Essentially no direct linkage |
| Treasuries | A beat → yields marginally higher; the main use is calibrating expectations for next month's closings and rate-sensitive sectors |
How to read it
The standard read:
| Dimension | How to read it |
|---|---|
| Monthly direction | Compare with the month's mortgage-rate move — a rebound when rates fell is a "normal response", not trend-reversal evidence |
| Versus next month's existing sales | Leading by 1–2 months — use this month's PHSI to revise in-flight expectations for the closing print |
| Signings-versus-closings gap | Strong signings followed by weak closings = rising cancellations/financing failures (a credit-tightening signal) |
| Annual rate and regional splits | Northeast/Midwest/South/West cycles differ — the national mean masks a lot; regional reads often carry more information |
The advanced frame: treat the PHSI as "housing's PMI" — it measures demand at the moment of occurrence, not completion. The classic historical use: at the 2005–06 housing top, the PHSI peaked months before existing sales — "signings turn first" is the textbook leading pattern. Bottoms work the same way: a sustained PHSI rebound in a cutting cycle is the earliest sign of housing stabilization.
Limitations & common mistakes
- Taking the m/m as trend: ±5% single months are normal — a 3-month direction makes a trend call.
- Ignoring cancellations: signings are not completions — cancellations from tight credit or failed appraisals create "strong signings, weak closings".
- Double-pricing with existing sales: same source (NAR), heavy overlap — the value is the timing gap, not new information.
- Treating the index as units: PHSI is indexed (2001=100) — volume judgments belong to existing sales.
- Ignoring regional splits: the national index masks regional differences in rate sensitivity and inventory — cross-region reads often beat the mean.
Related macro data
How it links to other macro data:
- With existing-home sales: the same-source lead-lag pair — PHSI sets direction, closings set magnitude and confirmation. existing-home-sales
- With NAHB: signings (immediate demand) plus the builder survey (supply-side perception) = the month's demand-plus-confidence double read. nahb
- With Treasury auctions: signings flex immediately with mortgage rates — a big move in long yields shows up in same-month signings first. treasury-auction
Symbols most sensitive to Pending Home Sales
Symbol pages that list this data as a factor to watch:
FAQ
Q When is it released?
Last week of the month at 10:00 ET (23:00/00:00 Beijing depending on DST), by NAR, covering prior-month signings — typically about a week after existing-home sales (~20th).
Q Signing versus closing — what differs?
Signing = the contract (demand occurring); closing = the completed, recorded transaction (what existing sales count). The 30–45 day gap makes signings lead closings by 1–2 months.
Q Why call it "housing's PMI"?
Because it is the earliest monthly demand read, fastest to react to rates, and leads the hard data — the same role PMIs play for industry: contracts/surveys lead, hard data confirm. It peaked months before existing sales at the 2005 top.
Q What does strong signings with weak closings mean?
Either rising cancellations (credit tightening, appraisal failures, buyer remorse) or timing misalignment in the closing frame. A divergence persisting months points to cancellations — an internal housing-tightening signal.
Q How do I use it in trading?
Not an event print (weak day elasticity) — it is an expectation calibrator: revise next month's existing-sales expectations, verify immediate rate transmission, and catch housing inflections early. Best paired with NAHB and rate moves.
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