Pending home sales rebound with 0.5% increase in September
Contracts to buy previously owned homes rose for the first time in three months, indicating that the recent market slump may be starting to stabilize, National Association of Realtors data showed Thursday.
The index rose 0.5% month-over-month (the estimate remained unchanged) after decreasing 1.9% (revised from a 1.8% drop). The gauge fell 3.4% year-over-year on an unadjusted basis (the estimate was a 2.6% decline) after slipping 2.6% in August.
The report signals that buyers are still looking to lock in purchases despite higher prices and mortgage rates. Data on Wednesday showed sales of new homes fell more than forecast in September to the weakest pace since 2016, while other reports have shown a drop in new-home construction and the slowest sales of existing homes in almost three years.
"This shows that buyers are out there on the sidelines, waiting to jump in once more inventory becomes available and the price is right," Lawrence Yun, NAR's chief economist, said in a statement. "Though affordability has been falling recently, the demand for housing should remain steady."
The advance was led by a 4.5% gain in the West, while the Midwest posted a 1.2% increase. The Northeast slid 0.4%, while the South was down 1.4%. Economists consider pending-home sales a leading indicator because they track contract signings; purchases of existing homes are tabulated when a deal closes, typically a month or two later.