Led by the South, pending home sales were up again and most recently stood at the highest level in nine months. But the outlook for strengthening is weak.
At the conclusion of last year, the Pending Home Sales Index was a seasonally adjusted 110.1. The index is preliminary and could be revised.
It was the highest level for the index,
an indication of upcoming existing home sales based on contract signings,
since it was a downwardly revised 111.3 in March 2017.
The National Association of Realtors reported the index Wednesday.
Last month’s index turned out to be an 0.5 percent increase from the upwardly revised level the preceding month and the upwardly revised level a year previous. A month-over-month gain has occurred for three consecutive months.
NAR predicts that existing home sales and price growth will moderate this year thanks to the
new tax law’s expected impact in high-cost housing markets.
NAR Chief Economist Lawrence Yun said in the report that plentiful jobs, higher wages and rising mortgage rates should encourage prospective home buyers to start searching now for a new home.
“Sadly, these positive indicators may not lead to a stronger sales pace,” Yun stated. “Buyers throughout the country continue to be hamstrung by record low supply levels that are pushing up prices — especially at the lower end of the market.”
In the South, the seasonally adjusted index was 126.9 as of December 2017, rising from a month earlier by 2.6 percent — more than any other region.
A 1.5 percent increase from November left the index at 101.7 percent in the West.
At 105.0 as of the final month of last year, the seasonally adjusted index in the Midwest was off less than a percent.
In the Northeast, the index fell 5.1 percent from the prior month to 93.9.
