Home Sales Remain at Worst Level in Over Two Years
In addition to a bitterly cold winter sweeping much of the nation, low inventory levels and higher home prices continue to cause issues for the housing market. Pending home sales in the United States remained at their worst level in more than two years.
The Pending Home Sales Index, a forward-looking indicator based on contract signings, edged only 0.1 percent to 95.0 in January from an upwardly revised 94.9 in December, according to the latest report from National Association of Realtors. On average, economists expected sales to increase by about 2 percent. It was the lowest reading for the index since November 2011 and 9 percent below from a year earlier.
Weather conditions were mentioned for the weak sales report, but other factors are also at play. “Ongoing disruptive weather patterns in much of the U.S. inhibited home shopping,” said Lawrence Yun, NAR Chief Economist, in a press release. “Limited inventory also is playing a role, especially in the West, while credit remains tight and affordability isn’t as favorable as it was a year ago.”