US pending home sales, or signed contracts to buy existing homes, rose 7.5% in October from a decline the previous month as purchasers sought to get ahead of a widely anticipated hike in interest and mortgage rates, the National Association of Realtors (NAR) said
WASHINGTON (Pakistan Point News / Sputnik - 29th November, 2021) US pending home sales, or signed contracts to buy existing homes, rose 7.5% in October from a decline the previous month as purchasers sought to get ahead of a widely anticipated hike in interest and mortgage rates, the National Association of Realtors (NAR) said.
"Motivated by fast-rising rents and the anticipated increase in mortgage rates, consumers that are on strong financial footing are signing contracts to purchase a home sooner rather than later," NAR Chief Economist Lawrence Yun said in a news release. "This solid buying is a testament to demand still being relatively high, as it is occurring during a time when inventory is still markedly low."
Pending home sales fell an unexpected 2.3% in September, according to NAR's records.
October's surge was probably the result of the desire of home buyers to try and lock in a purchase before the year ended as many continued to find very limited homes listed for sale, NAR said.
Total housing inventory at the end of October was down 0.8% from September, when it stood at 1.25 million units, and down 12.0% from one year ago, when it was at 1.42 million, NAR said.
At October's sales pace, what was sold represented a 2.4-month supply. A balanced market would be represented by sales of 4 to 6-month supply, NAR said.
Dire housing shortages in the United States since the financial crisis of 2007-2008 and last year's coronavirus outbreak have pushed up existing home prices to beyond the means of many Americans.
The median selling price for existing-homes in the United States rose 17.8% in July from a year earlier to hit a record high of $359,900.
To compound the housing problem, the Federal Reserve is expected to raise interest rates anywhere between the middle and end of 2022 in what would be the first hike of its kind since the COVID-19 outbreak in 2020.
