Pending home sales fall as economic uncertainty remains
The
pace
of
pending
home
sales
continued
to
dip
in
January,
according
to
data
released
Thursday
by
the
National
Association
of
Realtors
(NAR).
NAR’s
Pending
Home
Sales
Index
(PHSI)
fell
0.8%
from
a
month
prior
to
a
reading
of
70.9
in
January.
This
represents
a
0.4%
decline
compared
to
a
year
ago.
An
index
reading
of
100
is
equal
to
the
level
of
contract
activity
in
2001.
“Despite
lower
mortgage
rates,
affordability
concerns
and
economic
uncertainty
are
holding
buyers
back
at
the
beginning
of
2026.
Wintery
weather
also
likely
dampened
home-buying
activity,”
Lisa
Sturtevant,
the
chief
economist
at
Bright
MLS,
said
in
a
statement.
“A
lack
of
inventory
is
also
a
constraint
in
some
markets.”
Regionally,
pending
home
sales
fell
month-over-month
in
the
Northeast
(58.2)
and
South
(85.3),
dropping
5.7%
and
4.5%,
respectively.
In
contrast,
pending
home
sales
rose
on
a
monthly
basis
in
the
Midwest
(71.0)
and
West
(57.9),
rising
5.0%
and
4.3%,
respectively.
Year-over-year,
pending
home
sales
were
down
in
the
Northeast
(-8.3%)
and
Midwest
(-3.3%),
but
up
in
the
south
(4.0%)
and
West
(0.3%).
Despite
the
national
and
regional
declines,
NAR
highlighted
10
markets
among
the
50
largest
metro
areas
that
recorded
the
largest
annual
price
increases
in
pending
home
sales
in
January.
These
metros
included
Phoenix-Mesa-Chandler,
Arizona
(+11.8%),
Boston-Cambridge-Newton,
Massachusetts-New
Hampshire
(10.7%),
Charlotte-Concord-Gastonia,
North
Carolina
and
South
Carolina
(10.7%),
the
San
Francisco
Bay
Area
(8.9%)
and
Oklahoma
City
(8.7%).
While
these
markets
managed
to
produce
strong
results,
Lawrence
Yun,
NAR’s
chief
economist,
does
not
feel
improving
affordability
conditions
nationwide
have
yet
to
induce
more
buying
activity.
“With
mortgage
rates
nearing
6%,
an
additional
5.5
million
households
that
could
not
qualify
for
a
mortgage
one
year
ago
would
qualify
at
today’s
lower
rates,”
Yun
said
in
a
statement.
“Most
newly
qualifying
households
do
not
act
immediately,
but
based
on
past
experience,
about
10%
could
enter
the
market—potentially
adding
roughly
550,000
new
homebuyers
this
year
compared
with
last
year.”
If
these
additional
buyers
do
decide
to
enter
the
market,
Yun
warns
that
the
housing
supply
will
need
to
increase
or
buyers
will
be
again
faced
with
rising
affordability
challenges.
Looking
ahead,
economists
do
seem
to
have
some
reasons
to
be
optimistic
about
where
the
housing
market
is
headed.
“It
is
likely
that
we
will
see
more
home-buying
activity
over
the
coming
months
as
inventory
improves.
Spring
is
typically
the
busiest
market
when
homes
sell
the
quickest
and
offers
come
in
at
or
above
list
price.
But
this
year,
buyers
will
have
more
leverage
than
they
have
had
in
recent
years,”
Sturtevant
said.
“Sellers
will
need
to
get
their
home
‘move-in
ready’
and
priced
appropriately
if
they
want
a
quick
sale.”
