Pending Home Sales Fell in January
Pending home sales in the U.S. decreased by 0.8% in January compared to the previous month, according to the National Association of REALTORS. The report also showed a 0.4% decline in sales under contract compared to the same period last year. These figures provide an indicator of future existing-home sales.
- The West was one of only two regions to see a month-over-month increase in contract signings, with a 4.3% rise in January. The other region to see an increase was the Midwest, with a 5.0% jump. - Contract signings decreased in the Northeast and the South, with declines of 5.7% and 4.5% respectively from the previous month. - Despite the national decrease, the San Francisco-Oakland-Fremont metro area was among the top 10 markets with the largest year-over-year gains in pending home sales, showing an 8.9% increase. - NAR Chief Economist Lawrence Yun noted that with mortgage rates nearing 6%, an additional 5.5 million households could qualify for a mortgage compared to a year ago. He estimates about 10% of these households could enter the market. - The Pending Home Sales Index registered a reading of 70.9 in January; an index of 100 is equivalent to the level of contract activity in 2001. - Affordability issues and economic uncertainty are considered contributing factors to the sluggish national numbers, according to some economists. - The San Francisco housing market, specifically, is experiencing extremely low inventory, with just 93 single-family homes for sale in December, creating a deeply entrenched seller's market.
