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The
National Association of Realtors Pending Home Sales index rose
8.3% to 77.3, rebounding from a downwardly revised record-low of
71.4 in November. A poll by Reuters showed economists expected a
1.5% increase.
On a year-over-year basis, pending home sales have risen 1.3%.
“The housing market is off to a good start this year, as
consumers benefit from falling mortgage rates and stable home
prices,” said Lawrence Yun, chief economist at the NAR. “Job
additions and income growth will further help with housing
affordability, but increased supply will be essential to
satisfying all potential demand.”
The index had tumbled to record lows last year as higher
mortgage rates discouraged homeowners from selling, limiting
inventory and buyer traffic.
Mortgage rates neared 8% in October, a two-decade high, but have
eased after the Federal Reserve left its policy benchmark rate
unchanged since July. For the week ended Jan. 25, mortgage rates
edged up to 6.69% but remained stabilized in the mid-six percent
range, according to Freddie Mac.
Pending sales gained by the most in the West and South regions,
by 14% and 11.9%, respectively. The Northeast experienced the
only decline, with pending home sales falling by 3% on a monthly
basis.
Looking ahead, existing home sales are expected to rise by 13%
from 2023 to 4.62 million units in 2024, fueled by easing
interest rates and reduced volatility in the bond market, NAR
said. Median home prices are seen rising by 1.4% to $395,100 in
2024.
It also forecast that the Fed will cut its policy benchmark rate
four times, and the average 30-year fixed-rate mortgage will
hover between 6% and 7%.
(Reporting by Amina Niasse; Editing by Dan Burns and Andrea
Ricci)
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