By Dees Stribling | MHN Online
According to the National Association of Realtors on Thursday, the Pending Home Sales Index, a forward-looking indicator based on contract signings (but not closings), dropped to 107.7 in August from a downwardly revised 109.4 in July. That’s still above August 2012, however, when the index was 101.8. Pending sales have been above year-ago levels for the past 28 months.
NAR chalked up the drop to tight inventory conditions, higher interest rates, rising home prices, and continuing restrictive mortgage credit. “Sharply rising mortgage interest rates in the spring motivated buyers to make purchase decisions, culminating in a six-and-a-half-year peak for sales that were finalized last month,” NAR chief economist Lawrence Yun noted in a statement. “Moving forward, we expect lower levels of existing-home sales, but tight inventory in many markets will continue to push up home prices in the months ahead.”
