U.S. Pending Home Sales Rebounded in September
October 27 2016 - 11:00AM
Dow Jones News
WASHINGTON—A gauge of upcoming home sales moved higher in
September, a sign that last month's rebound in homebuying activity
might be sustained in the coming months.
The National Association of Realtors said Thursday that its
pending home sales index, which tracks contract signings for
previously owned homes, rose 1.5% from August to a seasonally
adjusted 110.0. Sales typically close within a month or two of
signing.
Economists surveyed by The Wall Street Journal had expected a
more modest increase of 1.0%.
The index has fluctuated in recent months. It was 111.2 in July
and fell in August to 108.4, revised down slightly from an earlier
estimate of 108.5, before partly rebounding in September. Compared
with a year earlier, pending home sales in September were up
2.4%.
"Although depressed inventory levels are keeping home prices
elevated in most of the country, steady job gains and growing
evidence that wages are finally starting to tick up are encouraging
more households to consider buying a home," said Lawrence Yun, the
trade group's chief economist.
News Corp, owner of The Wall Street Journal, also operates
Realtor.com under license from the National Association of
Realtors.
Purchases of existing homes, which account for roughly 90% of
U.S. homebuying activity, peaked in June at an annualized sales
rate of 5.57 million, the strongest monthly reading since February
2007. Sales weakened in July and August but rebounded in September,
rising 3.2% from the prior month to a seasonally adjusted annual
rate of 5.47 million, the National Association of Realtors said
last week.
Borrowing costs remain low for prospective home buyers. The
average interest rate on a 30-year fixed-rate mortgage in September
was 3.46%, down from 3.89% a year earlier, according to Freddie
Mac.
But tight inventory has put upward pressure on home prices,
hindering some would-be buyers.
Federal Reserve officials in September judged that "the
sluggishness in the housing sector appeared to have continued into
the third quarter," according to minutes of their Sept. 20-21
policy meeting.
Write to Ben Leubsdorf at ben.leubsdorf@wsj.com
(END) Dow Jones Newswires
October 27, 2016 10:45 ET (14:45 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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