Falling home sales in January plummeted and fell 4.7 percent in the National Association of REALTORS® (NAR) Pending Home Sales Index (PHSI). All four large regions in the US had less sales, with the Northeast 9 percent lower, the Midwest 6.6 percent lower, the South 3.9 percent lower and the West 1.2 percent lower.
<img class = "alignnone wp-image-140483 size-full" src = "http://rismedia.com/wp-content/uploads/2018/02/NAR_Jan_18-1.jpg" alt = "January 2018 Pending Home Sales Infographic  According to Lawrence Yun, chief economist at NAR, January's activity is due to mortgage interest and supply, which created conditions that stifle transactions.
"The economy is in good shape Most local job markets are very strong and earnings are slowly rising, but there is little doubt that last month's withdrawal in contract terms occurred because of the woefully low stock levels and the sudden rise in mortgage interest rates, "Yun says. The bottom of the market continues to feel the brunt of these supply and affordability issues. With the cost of buying a house that is more expensive and not enough stock, some potential buyers are waiting to see if the offers are rising in the spring or they have to postpone their search completely in order to save on a larger deposit. "
Inventory in January was 9.5 percent lower than in January 2017, while mortgage interest rates have risen at the same time.As of February 22, the average, 30-year-old, fixed mortgage was 4.40 percent – and it could rise to 4.75 percent in the next year, predictors speculate.
NAR & # 39; s REALTORS® Confidence Index, however, indicates traction even with the January slips.
"Although the contract excerpts were low, REALTORS® indicated that buyer traffic in most areas was January compared to a year ago," Yun says. "The exception was probably in the Northeast, where the icy cold spell that occurred in the first two weeks of the month may have contributed to the great deterioration of the region. "
There are other positives, says Yun.
" As a new multi-family supply catches the demand and slows the rents, some big investors beg collect their properties from affordable single-family homes for sale, which would be great news, especially for starters, "Yun says. "In addition, sellers usually stayed in their homes for ten years before they were sold (a historic record), although higher mortgage rates will probably discourage some homeowners from wanting a new house with a higher rate, there may be a lot of selling sellers who might be looking forward to redeeming or relocating this year. "
For more information, visit www.nar.realtor .