Pending home sales fell 4.9% between December and January, and are down 8.8% annually.
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Pending home sales fell in January, hurt by lower contract signings in the Midwest and South, according to the statistics data Published Thursday.
According to the National Association of Realtors, the pending home sales index fell 4.9% from December to January, and fell 8.8% annually to 74.3%. The decline in home prices comes as homebuyers react to fluctuations in mortgage rates.
“The nation’s total wealth is at an all-time high as the stock market and home prices rise, the job market stabilizes, and the nation’s total wealth is at an all-time high,” NAR Chief Economist Lawrence Yun said in a statement. “This combination of economic conditions is conducive to homeownership. However, consumers are Changes in mortgage rates during the current cycle are showing additional sensitivity, which is impacting home sales.”
In January, the number of contract signings in the Northeast region increased slightly by 0.8%, but dropped by 5.5% year-on-year; the western index rose by 0.5%, but dropped by 7% from the same period last year. Pending sales in the Midwest fell 7.6% from the previous quarter and 11.6% year-on-year, while those in the South fell 7.6% from the previous quarter and 9% from the same period last year.
“Employment growth is faster in the Southern states and the Rocky Mountain time zone compared to the rest of the country,” Yun said. “As a result, long-term housing demand growth is more significant in these areas. However, the timing and amount of purchases will depend heavily on prevailing mortgage rates and inventory conditions.”
December’s pending home sales report – which saw contract signings increase 8.3% month over month and 1.3% year over year – was interpreted as a harbinger of a strong housing market in 2024. However, this was before mortgage rates rose again and led to the lackluster results in January.
“December’s pending home sales appear to be a boon for the housing market in 2024 — at least as long as mortgage rates Stable or declining.” “That promise was quickly broken as mortgage rates began to rise in January. Fewer homebuyers and pending home sales fell nearly 5%, erasing December’s gains.”
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