At first glance it seems like a huge and hopeful headline: Pending home sales, based on contracts signed, rose 10.4 percent in October from September.
It certainly gives the impression that buyers are hopping off the fence and into the market.
Well, let's not get ahead of ourselves.
First of all, October pending salesare historically always up month-to-month.
"In fact, when backing out Armageddon 2008 as a one-off, the average post-crash October is up exactly the same as 2011," notes mortgage analyst Mark Hanson. "Bottom line, with record low prices, record low rates, record high pending cancellations, the 8.3 percent [not seasonally adjusted] month-over-month change is far worse than average."
The other problem is that a good chunk of those contracts signed will not reach the closing table. Thirty-three percent of Realtors reported at least one cancellation in October, which is up from 8 percent a year ago.