Pending home sales fall unexpectedly in June

Buyers signed fewer contracts for previously owned homes in June, a sign the housing market was struggling to pick up steam.

The National Assn. of Realtors said Monday that its pending sales index fell 1.1% from May. Economists had expected sales to increase slightly.

The disappointing report comes after pending sales had risen for three straight months. Those increases raised hopes that the housing market was heating up after starting to cool last summer amid higher prices and mortgage rates.

But Monday’s report, along with other recent data, has dimmed that optimism. Last week, the Commerce Department said new-home sales fell 8.1% in June.

Tight lending standards and meager income growth are discouraging many potential buyers, said Lawrence Yun, the Realtor group’s chief economist.

Still, the trade group said June’s index level shows contract signings were slightly above average, despite the decline from May.

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