Slight increase in pending home sales disappoints
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Signed contracts for previously owned homes rose less than expected last month as the national housing market struggled to gain momentum.
Pending home sales inched up 0.3% in September from a month earlier, the National Assn. of Realtors said Monday. The report missed analyst expectations of a 1% gain.
Higher prices and mortgage rates this year blunted the torrid housing recovery of 2013 and priced many families out of the market. The slight sales increase last month, which followed a 1% decline in August, signals many buyers remain handcuffed.
“Tiny steps in a positive direction are a far cry from the robust housing activity many analysts expected -- and the Fed hoped for -- after a weak start to the year,” Sterne Agee chief economist Lindsey M. Piegza said in a research note.
However, the Realtors said the recent trend of falling mortgage rates should allow more families to purchase a house. The average rate for a 30-year fixed mortgage sank to 3.92% last week, the lowest of the year, according to mortgage finance giant Freddie Mac.
Pending home sales fell 0.8% in the West last month. The only other region to post a decline was the Midwest, where sales dropped 1.2%.
Pending sales reflect contracts signed but not closed. The deals usually become final in one or two months.
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