Contracts to purchase previously owned homes rose in November as employment gains and low borrowing costs helped bring potential buyers into the market.
The pending home sales index advanced 0.8% after a revised 1.2% decrease in October, the National Association of Realtors said today in Washington. The median projection in a Bloomberg survey of economists called for the index to rise 0.5%, with estimates ranging from a decline of 1.5% to an advance of 3.5%.
"The consistent economic growth and steady hiring we’ve seen in the second half of this year is giving buyers enough assurance to consider purchasing a home before year’s end," NAR chief economist Lawrence Yun said in a statement. "With rents now rising at a seven-year high, historically low rates and moderating price growth are likely to entice more buyers."
Purchase contracts climbed 1.7% in the 12 months ending in November after a 2.1% annual increase in October on an unadjusted basis, the NAR report showed. The three months of year-over-year advances follow a series of 11 straight declines.
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Pending sales increased in three of four regions from the previous month, led by a 1.4% gain in the Northeast. Contract signings climbed 1.3% in the South and 0.4% in the West. They fell 0.4% in the Midwest.
Economists consider pending sales a leading indicator because they track new purchase contracts. Existing-home sales are tabulated when a deal closes, usually a month or two later.
Those resales dropped more than forecast last month to a 4.93 million annual pace, the weakest reading since May and down 6.1% from a 5.25 million pace in October, NAR data showed last week.
New-home construction exceeded a 1 million annualized pace in November for a third month. Housing starts declined 1.6% to a 1.03 million annualized rate, Commerce Department data showed.
