Pending Home Sales Rise 0.2% in October
November 30 2015 - 10:40AM
Dow Jones News
WASHINGTON—The number of existing homes that went under contract
in the U.S. inched up in October, a sign the housing market remains
stable heading into the final months of the year.
An index measuring pending home sales—a gauge of purchases
before they become final—rose 0.2% to a seasonally adjusted reading
of 107.7 in October, the National Association of Realtors said
Monday. An index of 100 is equal to the average level of contract
activity during 2001.
Economists surveyed by The Wall Street Journal had predicted a
1.5% increase in October sales. September's reading was revised to
a 1.6% decline from an initially estimated 2.3% drop. The index
peaked for the year in May and has mostly edged down since.
It typically takes a month or two for a home purchase to be
completed. When the sale is finalized, it is registered in the
Realtors' more closely watched existing-home sales report. That
report showed sales of previously owned homes, roughly 90% of the
overall housing market, reached a post-recession peak of a 5.58
million annual pace in July, and hovered slightly below that level
this fall.
The industry group said the pace of sales plateaued in recent
months because buyers are finding a small number of available homes
and prices are rising quickly in some markets.
"In the most competitive metro areas—particularly those in the
South and West—affordability concerns remain heightened as low
inventory continues to drive up prices," said Lawrence Yun, the
NAR's chief economist.
Supported by historically low interest rates on mortgage loans
and steady hiring, the housing market has been a bright spot for
the economy this year. Home purchases signal that consumers have
confidence in the economy, and typically coincide with increased
spending on appliances, furniture and home improvements.
Economists are watching the sector to see if it can maintain
momentum in the face interest rates increasing from record lows and
a limited selection of homes pushing up prices.
Monday's report showed pending home sale were up 3.9% from a
year earlier in October.
On the month, sales increased in the Northeast and West, but
fell in the South and Midwest.
News Corp, owner of The Wall Street Journal, also owns Move
Inc., which operates a website and mobile products for the National
Association of Realtors.
Write to Eric Morath at eric.morath@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
November 30, 2015 10:25 ET (15:25 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
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