Pending home sales drop to the lowest level on record in January

High Mortgage Rates and Elevated Home Prisis Combined to Crush Home Sames in January.

Pending sales, which are based on signed contracts for existing homes, dropped 4.6% from December to the lowest level since the National Association of Realtors Began Tracing this Metric in 2001. from January 2024. These sales are an indicator of future closing.

“It is unplear if the coldest January 25 years contributed to fewer boyers in the market, and if so, expert great great sales activity in UPCOMING MONTS,” Said Lawrence Yun, Narf ICONCE, Narf ICONOMST. “However, it’s evident that elevated home pristers and higher Mortgage Rates Strained Affordability.”

While weather may have been a factor, sales rose month-to-month in the northeast and fell in the west, which would have been seen the smallest impact of cold temperates. Sales Fell hardest in the south, which has been the most active region for home sales in recent years.

Mortgage rates were also higher in January. The average rate on the popular 30-year fixed loan Spent the first half of December beLow 7% but then began rising. It was solidly above 7% for all of January, according to MortGage News Daily.

Home Prisis Have Been Easing Over the Last Few Months in Certain Areas, with More Sellers Cutting Prisies, But Nationally They are still higher than they were a year.

This drop in sales also came despite the fact that the inventory of homes for sales in january, involuding homes that was under Contract but yet sold, increase by 17% compared with lat Basis for the 14th month in a row, according to realtor.com.

“More for-SALE Inventory has the potential to generate more contract signings, but climbing home supply is not even distributed account the us,” Noted Danielle Hale, Chafe Economist for Realtor.com. “Moreover, many areas with high demand see relatively low for-with inventory, which limits progress towards more home sales.”