Pending home sales fell to a 20-year low
With higher mortgage rates on the minds of homebuyers, fewer people are buying homes.
Yahoo Finance’s Danny Romero reports:
Contract signings for existing homes recorded their slowest pace in more than two decades in October.
Home sales under contract fell 1.5% from the previous month, according to the National Association of Realtors on Thursday. The index reading of 71.4 is the lowest since the index was established in 2001. An index level of 100 equates to the pace of contracting activity in 2001.
However, the results were better than the 2.0% decline estimated by Bloomberg economists and came after a larger decline in new home sales in the same month.
The drop in the index, a leading gauge used to gauge the health of the housing market, reflected how rising rates again troubled budget-sensitive buyers in October and reduced pending sales in the resale market by 8.5% annually.
“Rates were 8% in October. They are the highest in 23 years, which pushed affordability to the lowest level,” RSM US Real Estate Senior Analyst Crystal Sunbury told Yahoo Finance ahead of the release. “We will see pending home sales fall in October.”