Pending home sales decreased 5.5% in December compared with November and were down 5% compared with December 2023, according to the National Association of Realtors (NAR).
Regionally, and month-over-month pending home sales dropped 8.1% in the Northeast, 4.9% in the Midwest, 2.7% in the South, and 10.3% in the West.
Year-over-year, contract signings dropped 1.3% in the Northeast, 6.9% in the Midwest, 5.1% in the South and 5.1% in the West.
The drop in December, which follows four consecutive months of increases, brought the Pending Home Sales Index (PHSI) to a score of 74.2.
“After four straight months of gains in contract signings, one step back is not welcome news, but it is not entirely surprising,” says Lawrence Yun, chief economist for NAR, in a statement. “Economic data never moves in a straight line. High mortgage rates have not significantly dented housing demand due to greater numbers of cash transactions.”
Looking at the regional breakdown, Yun adds, “Contract activity fell more sharply in the high-priced regions of the Northeast and West, where elevated mortgage rates have appreciably cut affordability.”
“Job gains tend to have greater impact in more affordable regions,” he says. “It is unclear if heavier-than-usual winter precipitation impacted the timing of purchases.”
Photo: Gabrielle Henderson
