After rising for four straight months, Pending Home Sales dropped by 5.5% from November to December per the latest report from the National Association of REALTORS® (NAR). This metric reflects signed contracts on existing homes, typically occurring one to two months prior to closing, and serves as a leading indicator of housing market trends.
What’s the bottom line?
NAR Chief Economist, Lawrence Yun, observed that “contract activity fell more sharply in the high-priced regions of the Northeast and West, where elevated mortgage rates have appreciably cut affordability.” He also noted that “job gains tend to have greater impact in more affordable regions. It is unclear if heavier-than-usual winter precipitation impacted the timing of purchases.”