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Pending home sales across nation rise, ending six-month decline
Paula Wolf, contributing writer//June 28, 2022
Pending home sales across nation rise, ending six-month decline
Paula Wolf, contributing writer//June 28, 2022//
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The National Association of Realtors reported Monday that pending home sales across the country inched up in May, ending a six-month run of month-over-month declines.
The results, however, varied by region, as the Northeast and South saw increases while the Midwest and West experienced decreases.
The Pending Home Sales Index, a forward-looking indicator of home sales based on contract signings, rose 0.7% in May, to 99.9. An index of 100 is equal to the level of contract activity in 2001.
In the Northeast, the index climbed 15.4%.
“Despite the small gain in pending sales from the prior month, the housing market is clearly undergoing a transition,” NAR Chief Economist Lawrence Yun said in a release. “Contract signings are down sizably from a year ago because of much higher mortgage rates.”
According to NAR, at the median single-family home price and with a 10% down payment, the monthly mortgage payment has increased by about $800 since the beginning of January as mortgage rates have climbed by 2.5 percentage points.
“Trying to balance the housing market by choking off demand via higher mortgage rates is damaging to consumers and the economy,” Yun explained. “The better way to balance the market is through increased supply, which also helps the broader economy.”
The largest decline in pending sales was in the West, he said, where homes are the priciest.
Paula Wolf is a freelance writer
