There was an increase in pending home sales across most markets in February following weakness in the previous month
There was an increase in pending home sales across most markets in February following weakness in the previous month.
The National Association of Realtors’ Pending Home Sales Index shows a 3.1% rise to 107.5 in February, following the downwardly-revised January reading of 104.3.
However, February was still down 4.1% year-over-year, but NAR chief economist Lawrence Yun noted that February 2017 was second-highest index reading (112.1) in a decade, and inventory is very low.
“The expanding economy and healthy job market are generating sizeable homebuyer demand, but the miniscule number of listings on the market and its adverse effect on affordability are squeezing buyers and suppressing overall activity," said Yun.
He added that the Northeast is likely to continue to lag on pending sales through March due to adverse weather.
With affordability pressured, and sellers concerned about losing their locked-in mortgage rates, he suspects the low inventory may not ease soon.
"Even if new home construction starts picking up at a faster pace this year, as expected, existing sales will fail to break out if these record low supply levels do not recover enough to meet demand," he said.
