After plunging by the most since COVID lockdowns in September, analysts expected US pending home sales to tumble once again in October and they did, dropping 4.6% MoM (September was revised slightly higher from -10.2% MoM to -8.7% MoM)…
This the 5th straight month of sales declines (and 11th of the last 12 months) leaving the YoY drop down over 36% – the biggest annual drop ever.
“October was a difficult month for home buyers as they faced 20-year-high mortgage rates,” Lawrence Yun, NAR’s chief economist, said in a statement.
“The West region, in particular, suffered from the combination of high interest rates and expensive home prices. Only the Midwest squeaked out a gain.”
Absent the COVID collapse, this is the weakest level for the Pending Home Sales Index since the nadir in June 2010…
Pending home sales are often looked to as a leading indicator of existing-home purchases given properties typically go under contract a month or two before they’re sold
Existing home sales tumbled in October while new home sales rose (cancellations are not counted), and so the pending home sales print confirms the weakness that Jay Powell apparently is looking for in the US housing market.
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