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Pending Home Sales Rebound In January On Lower Interest Rates, Still Below Year-Ago Figure

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Pending Home Sales Rebound In January On Lower Interest Rates, Still Below Year-Ago Figure

Pending home sales rebounded in January from the previous month, with lower interest rates getting credit for the comeback, but sales still weren't as robust as they were a year ago.

What To Know

The National Association of Realtors reported Wednesday pending sales increased 4.6 percent to 103.2 in January, up from 98.7 in December. But the 2.3 percent drop in year-over-year contract signings put a cautionary note on the otherwise good news, marking the 13th straight monthly decrease in new home sales.

Fed policy on interest rates was credited with getting buyers back into home buying mode.

“A change in Federal Reserve policy and the reopening of the government were very beneficial to the market,” NAR chief economist Lawrence Yun said. “Homebuyers are now returning and taking advantage of lower interest rates, while a boost in inventory is also providing more choices for consumers.”

Related Link: Weakness Abounds In The Housing Market As Building, Sales Have Stalled

The jump in home sales was pushed by buyers in the South. Home sales in that region were up 8.9 percent - though still 3.1 percent lower than a year ago. Increases were much smaller in the Northeast (1.6 percent), Midwest (2.8 percent) and West (0.3 percent), the NAR said.

Homebuilding Down

The report came a day after the Commerce Department reported that homebuilding plunged to its lowest level in more than two years in December, with construction of new homes, or housing starts, dropping 11.2 percent from November, the lowest number of starts since September of 2016. The drop was seen in both single and multi-family housing.

One bit of good housing news from December: building permits increased slightly, meaning more building could be coming in the near-future, with the increase was mostly in apartment buildings while permits for single-family homes were down slightly.

Posted-In: Home Sales Pending Home SalesNews Econ #s Best of Benzinga

 

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