U.S. Pending Home Sales Fell 1.8% in August
WASHINGTON—The number of U.S. existing homes going under contract declined in August for the fourth time in five months, reflecting what appears to be a broader slowdown in the housing market.
The National Association of Realtors on Thursday said its pending home-sales index, which tracks contract signings for purchases of previously owned homes, fell 1.8% from the prior month to 104.2 in August. Sales, unless they fall through, typically close within a month or two of signing.
Economists surveyed by The Wall Street Journal had expected a 0.4% decline in August.
The index was down 2.3% in August from a year earlier.
“With prices having risen so quickly, many consumers were deciding to wait to list their homes hoping to see additional price and equity gains,“ said Lawrence Yun, the trade group’s chief economist. ”However, with indications that buyers are beginning to pull out, price gains are going to decelerate and potential sellers are considering that now is a good time to list and bring more properties to the market.”
More widely, housing-market inventory has been tight, driving up home prices and pricing some potential buyers out of the market. At the same time, skilled construction labor shortages, higher input costs and rising mortgage rates are also making the overall cost of buying a home more expensive. Sales of previously owned homes stalled in August, highlighting a growing disconnect between the sluggish housing market and robust economic growth.