July Pending Home Sales Drop

Pending home sales fell in July, reversing from two consecutive months of gains, the National Association of Realtors reported yesterday.

The Pending Home Sales Index, a forward-looking indicator based on contract signings, decreased by 2.5% to 105.6 in July, down from 108.3 in June. Year-over-year contract signings fell 0.3%, negating June’s increase.

All four regions saw declines, most acutely in the West, which fell by 3.4% in July to 93.5 but increased by 0.3% from a year ago. Pending home sales in the South decreased 2.4% to 122.7 in July, but improved by 0.1% from last July.

The Northeast fell by 1.6% to 93.0 in July and fell by 0.9% from a year ago. In the Midwest, the index fell by 2.5% to 101.0 in July and by 1.2% from a year ago.

“Super-low mortgage rates have not yet consistently pulled buyers back into the market,” said NAR Chief Economist Lawrence Yun,. “Economic uncertainty is no doubt holding back some potential demand, but what is desperately needed is more supply of moderately priced homes.”