Finance

U.S. pending home sales race to seven-month high in August

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Actual property indicators promote new houses on the market in a number of new developments in York County, South Carolina, U.S., February 29, 2020. REUTERS/Lucas Jackson//File Picture

WASHINGTON, Sept 29 (Reuters) – Contracts to purchase U.S. beforehand owned houses rebounded to a seven-month excessive in August, however greater costs amid tight provide are slowing the housing market momentum.

The Nationwide Affiliation of Realtors (NAR) mentioned on Wednesday its Pending Residence Gross sales Index, primarily based on signed contracts, jumped 8.1% final month to 119.5. That was the very best studying since January and adopted two straight month-to-month declines.

Economists polled by Reuters had forecast contracts, which turn out to be gross sales after a month or two, rising 1.4%. In contrast with a yr in the past, pending dwelling gross sales fell 8.3% in August.

The housing market boomed early within the COVID-19 pandemic amid an exodus from cities as individuals labored from dwelling and took courses on-line. However the pandemic tailwind is fading as vaccines permit employees to return to workplaces.

Costly houses are additionally sidelining some first-time patrons from the market. The NAR reported final week that the share of first-time patrons was the smallest in additional than 2-1/2 years in August. Current dwelling gross sales dropped final month.

Knowledge on Tuesday confirmed shopper sentiment in direction of shopping for a house weakening for a 3rd straight month in September and home costs posting file beneficial properties in July from a year-ago.

The surge in pending dwelling gross sales final month was led by the South and Midwest areas, the place the NAR mentioned home value will increase have been typically reasonable relative to the remainder of the nation. Contracts soared 10.4% within the Midwest and vaulted 8.6% within the densely populated South. They rose 4.6% within the Northeast and superior 7.2% within the West.

Reporting by Lucia Mutikani; Modifying by Andrea Ricci

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