WASHINGTON – Contracts to buy first-owned homes in the US hit a seven-month high in August, but higher prices amid tight supplies are slowing the housing market.
The National Association of Realtors (NAR) on Wednesday said its pending home sales index, based on signed contracts, rose 8.1 per cent to 119.5 last month. This was the highest reading since January and was followed by two consecutive monthly declines.
Economists surveyed by Reuters had forecast contracts, which become sales after a month or two, a 1.4 percent increase. Compared to a year ago, pending home sales fell 8.3 percent in August.
The housing market boomed in the COVID-19 pandemic amid exodus from cities as people worked from home and took online classes. But the pandemic tailwind is fading as vaccines allow workers to return to offices.
Expensive homes are also turning some first-time buyers away from the market. NAR reported last week that the share of first-time buyers was the smallest in more than 2-1/2 years in August. Current home sales fell last month.
Data on Tuesday showed consumer sentiment towards home buying weakened for the third straight month in September and home prices posted record gains in July from a year ago.
The growth in pending home sales last month was led by the south and mid-west regions, where the NAR said growth in home prices has been generally moderate compared to the rest of the country. Contracts rose 10.4 percent in the Midwest and 8.6 percent in the densely populated South. They grew by 4.6 percent in the Northeast and 7.2 percent in the West.
This News Originally From – The Epoch Times