Pending Home Sales Dip, But Trend Still Positive, Realtors Say

Pending home sales dipped in December after reaching a 19-month high, but remained above year-ago levels, according to the National Association of Realtors.
The NAR’s Pending Home Sales Index, an indicator based on contract signings, declined 3.5 percent to 96.6 in December, compared to 100.1 in November.
But the index is 5.6 percent above December 2010 when it was 91.5. The data reflects contracts but not closings.
Lawrence Yun, NAR chief economist, said the trend is still positive, although contract cancellations persist.
“Even with a modest decline, the preceding two months of contract activity are the highest in the past four years outside of the homebuyer tax credit period,” he said. “Contract failures remain an issue, reported by one-third of Realtors over the past few months, but home buyers are not giving up.”
Yun said some buyers complete the sale after a contract delay, while others stay in the market after a contract failure and make another offer. Mortgage rates have remained at or near record lows for several months.
“Housing affordability conditions are too good to pass up,” Yun said. “Our hope is lending conditions will gradually improve with sustained increases in closed existing-home sales.”

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