Home for sale sign (Realtors) and potential exiting and pending home sales contract. (PHOTO: REUTERS)
The National Association of Realtors (NAR) said Wednesday the Pending Home Sales Index (PHSI) fell in November, missing the 0.5% increase economists expected. The PHSI fell 2.5% to 107.3 in November from 110.0 in October.
“The budget of many prospective buyers last month was dealt an abrupt hit by the quick ascension of rates immediately after the election,” said Lawrence Yun, NAR chief economist. “Already faced with climbing home prices and minimal listings in the affordable price range, fewer home shoppers in most of the country were successfully able to sign a contract.”
By following last month’s decrease in activity, the PHSI is now 0.4% lower than last November (107.7) and is at its lowest reading since January (105.4).
“Healthy local job markets amidst tight supply means many areas will remain competitive with prices on the rise. Those rushing to lock in a rate before they advance even higher will probably have few listings to choose from,” Mr. Yun added. “Some buyers will have to expand the area of their home search or be forced to delay in order to save a little more money for their down payment.”
In the Northeast, the PHSI inched higher by 0.6% to 97.5 in November, and is now 5.7% above a year ago. In the Midwest, the index fell 2.5% to 103.5 and is now 2.4% lower than it was in November 2015.
Pending home sales in the South fell 1.2% to 118.7 and are now 1.3% lower on a year-over-year basis. The index in the West also fell 6.7% to 101.0 and is now 1.0% below a year ago.
