Pending Home Sales Increase 0.3%

Pending home sales increased by 0.3% month-over-month in August but decreased 4.7% year-over-year, the National Association of Realtors reported yesterday.

The association’s Pending Home Sales report said month-over-month pending home sales increased in the South and West but declined in the Northeast and Midwest. Year-over-year pending home sales declined in all four major U.S. regions.

“Buyers steadily entered into contracts in August even though mortgage rates increased,” NAR Chief Economist Lawrence Yun said. “However, the housing market is still sluggish, with contract signings below last year. This is due to higher mortgage rates offsetting the increased buying power created by job gains and income growth outpacing home price growth.”

Yun added that the Northeast and the Midwest saw the fastest home price growth in August, “which is part of the reason that those same two regions posted the steepest declines in contract signings.”

“Nationally, contract signings today are running roughly 30% below where they were in the years leading up to the pandemic,” Yun said. “Transaction activity peaked in 2021 when mortgage rates fell to near 3%, a historic low, and has not approached that level since.”