U.S. pending home sales indicator jumps to five-month high

U.S. pending home sales rebounded sharply to a five-month high in December, showing recent Mortgage rates fall Helps stabilize the resale market.

Data released Friday showed the National Association of Realtors’ contract signing index rose 8.3% to 77.3 after hitting a record low a month ago. Last month’s gain was the biggest since mid-2020 and beat all expectations in a Bloomberg survey. economist.

“The housing market is off to a strong start this year, with consumers benefiting from lower mortgage rates and stable home prices,” NAR Chief Economist Lawrence Yun said in a statement. “Increasing job opportunities and rising incomes will further help improve housing affordability.” , but increasing supply is critical to meeting all potential demand. “

While 30-year fixed mortgage rates remain below 7%, continued declines are needed to encourage more homeowners to list homes with much lower financing levels.Until then, limited second-hand housing inventory will keep resale market Gain attention quickly.

The scarcity of housing has also caused existing home prices to rise. Meanwhile, builders have been filling the gaps with new construction. By the end of 2023, the number of new homes for sale rose to its highest level in more than a year. High, Help drive those prices down.

The Pending Home Sales Report is a leading indicator of existing home sales since homes typically go into contract a month or two before they go on sale. Sales are expected to grow 13% this year, according to NAR’s economic outlook. In 2023 it will be 18.7%.

The NAR report showed that the index of existing home contracts in the South, the largest U.S. housing market, jumped nearly 12%, the largest increase since June 2020. Pending sales also surged 14% in the West, while pending home sales surged 5.6% in the West. Midwest.

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