Pending home sales remained essentially flat nationwide last month, indicating that tight inventory and high prices continue to weigh on buyers.
The National Assn. of Realtors said Friday that its pending sales index rose 0.1% in January from the month before to a reading of 95. Since January 2013, the index fell 9%.
Lawrence Yun, the Realtors group’s chief economist, said that severe weather across much of the U.S. held back sales, but that it wasn’t the only factor.
“Limited inventory also is playing a role, especially in the West, while credit remains tight and affordability isn’t as favorable as it was a year ago,” he said in a statement.
Yun said more new home construction is needed to expand the number of homes for sale and put a check on price growth.
The seasonally adjusted pending sales index is a gauge of future market activity. It is based on contracts signed, but not closed.
A level of 100 equals the average contract activity in 2001, a year when existing home sales reached a level that would be healthy based on today's population, the Realtors say.
Pending deals fell 2.5% in the Midwest from December, and tumbled 4.8% in the West. Signed contracts rose in both the South and Northeast.
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