U.S. home sales down, interest rates higher | November 1, 2013 | Pleasanton Weekly | PleasantonWeekly.com |

Pleasanton Weekly

Real Estate - November 1, 2013

U.S. home sales down, interest rates higher

Economist sees 'flat trend' in home sales next year

by Jeb Bing

Pending home sales declined across the country for the fourth consecutive month in September, as higher mortgage interest rates and higher home prices curbed buying power, according to the National Association of Realtors.

The organization's "Pending Home Sales Index" fell 5.6% to 101.6 in September from a downwardly revised 107.6 in August, and is 1.2% below September 2012 when it was 102.8. The index is at the lowest level since last December when it was 101.3.

Lawrence Yun, NAR's chief economist, said concerns over the government shutdown also played a role.

"Declining housing affordability conditions are likely responsible for the bulk of reduced contract activity," he said. "In addition, government and contract workers were on the sidelines with growing insecurity over lawmakers' inability to agree on a budget."

"A broader hit on consumer confidence from general uncertainty also curbs major expenditures such as home purchases," he added.

Yun noted that September marked the first time in 29 months that pending home sales weren't above year-ago levels.

"This tells us to expect lower home sales for the fourth quarter, with a flat trend going into 2014," Yun said. "Even so, ongoing inventory shortages will continue to lift home prices, though at a slower single-digit growth rate next year."

NAR's Pending Home Sales Index in the Northeast dropped 9.6% to 76.7 in September, and is 6.4% below a year ago. In the Midwest the index fell 8.3% to 102.3 in September, but is 5.7% higher than September 2012. Pending home sales in the South slipped 0.4% to an index of 116.2 in September, but are 2.0% above a year ago.

The index in the West dropped 9.0% in September to 97.3, and is 9.8% lower than September 2012.

Total existing-home sales this year will be 10% higher than 2012, reaching more than 5.1 million, and are likely to hold up well even in 2014. The national median existing-home price is expected to rise 11 to 11.5% for all of 2013, but moderate to a 5 to 6% gain in 2014.


There are no comments yet for this post

Post a comment

Posting an item on Town Square is simple and requires no registration. Just complete this form and hit "submit" and your topic will appear online. Please be respectful and truthful in your postings so Town Square will continue to be a thoughtful gathering place for sharing community information and opinion. All postings are subject to our TERMS OF USE, and may be deleted if deemed inappropriate by our staff.

We prefer that you use your real name, but you may use any "member" name you wish.

Name: *

Select your neighborhood or school community: *

Choose a category: *

Since this is the first comment on this story a new topic will also be started in Town Square! Please choose a category that best describes this story.

Comment: *

Verification code: *
Enter the verification code exactly as shown, using capital and lowercase letters, in the multi-colored box.

*Required Fields