The warmer temperature did not heat up the pending home sales in the U.S. based on last month's record.
Reuters reports that for the third time in 4 months, transactions to purchase previously owned U.S. homes, an indication that the market is actually cooling down.
The National Association of Realtors (NAR) said on Wednesday that a slip of 0.9 percent to 106.9 was recorded on its pending home sales index. The index slightly rose the month before last, NAR added and there were expectations that it would rise by 0.5 percent in November but it did not happen.
The trend is that pending home contract are fully executed after a month or two. The declined recorded and experienced in the recent months could be a glaring indications that there might be a slower growth come 2016 when it comes to homebuying. Add the fact that it is the same time the interest rates are expected to rise, it does not paint a good picture.
The report adds that, Mortgage rates have only inched higher since the Federal Reserve raised its benchmark rate by a quarter point on Dec. 16, but Fed policymakers expect to continue hiking next year."
Strong gains were posted early in the year in pending home sales and the same were still up by 2.7 percent from last year. However, contracts began to fall by as much as three percent in the Northeast last November and worse, it was down by 5.5 percent in the West, the report adds. The good news is, if it can be considered as that, was that there's a rise of 1.3 percent in the South and a 1.0 percent gain in the Midwest. It does not seem as bleak as it looks but either way, the market does not seem promising in 2016 considering that there are still shortage of home supply to meet the demand.
