Pending home sales puked in January, tumbling 4.9% MoM (vs +1.5% MoM exp). This was made worse by a large downward revision for December (from +8.3% MoM to +5.7% MoM)...
Source: Bloomberg
That was the biggest MoM decline since August and dragged the YoY sales decline to -6.
82%, tumbling back near record lows...
Source: Bloomberg
Realtors gonna realtor...
“This combination of economic conditions is favorable for home buying,” Lawrence Yun, NAR’s chief economist, said in a statement.
“However, consumers are showing extra sensitivity to changes in mortgage rates in the current cycle, and that’s impacting home sales.”
WTF are you talking about Larry?
Earlier this week, a gauge of US mortgage applications for home purchases fell for a fifth week, nearing its lowest level since 1995.
Who could have seen that coming? As rates surged once again...
Source: Bloomberg
The pending-home sales report is a leading indicator of existing-home sales given houses typically go under contract a month or two before they’re sold.
The index of contract signings decreased 7.3% in the South, the nation’s biggest housing market.
Pending sales also fell 7.6% in the Midwest, but climbed 0.8% in the Northeast and 0.5% in the West.
“Southern states and those in the Rocky Mountain time zone experienced faster job growth compared to the rest of the country,” Yun said.
“As a result, long-term housing demand is increasing more significantly in these regions. However, the timing and number of purchases will largely depend on the prevailing mortgage rates and inventory availability. ”
Overall sales are expected to increase 13% this year, according to NAR’s economic outlook, but as the chart above shows, unless rates start tumbling soon, that ain't gonna happen.