Homebuying momentum on the rise, says NAR's Yun
Pending home sales across the US hit their highest level since March last month as a brief spell of lower mortgage rates helped move homebuyers off the sidelines.
The National Association of Realtors (NAR) said Wednesday that its gauge of contract signings crept up by 2% to 77.4 in October, defying expectations of market watchers surveyed by Bloomberg who had expected a drop by the same amount.
Mortgage rates have ticked higher since early October after sliding during the summer – but Lawrence Yun, NAR’s chief economist, said the October sales figures showed homebuying momentum was on the rise again after a subdued year to date.
“Even with mortgage rates modestly rising despite the Federal Reserve’s decision to cut the short-term interbank lending rate in September, continuous job additions and more housing inventory are bringing more consumers to the market,” he said in a statement.
Pending home sales increased 2.0% in October. All four major U.S. regions experienced month-over-month gains in transactions, with the Northeast leading the way. https://t.co/kQaa3wnYRP
— National Association of REALTORS® (@nardotrealtor) November 27, 2024
While supply across the country is now at a four-year high, it remains well below the levels seen before the COVID-19 pandemic. First American deputy chief economist Odeta Kushi said the inventory uptick had helped buyers but pointed to further hurdles ahead for the US mortgage market.
“Mortgage applications – another leading indicator of sales activity – suggest that the housing market’s challenges remain,” she wrote. “So far in November, mortgage applications have ticked modestly lower as rates climbed even higher. While increased inventory provides buyers with more options, the reality remains – you can’t buy what you can’t afford.”
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