The contracts to purchase previously owned homes in the United States increased only modestly in the month of November, signalling toward a sluggish housing market despite several months of stronger economic growth and hiring by employers.
According to a report released by the National Association of Realtors on Wednesday, its Pending Home Sales Index gained 0.8 percent to 104.8.
Lawrence Yun, NAR’s chief economist, said, “The consistent economic growth and steady hiring we’ve seen the second half of this year is giving buyers enough assurance to consider purchasing a home before year’s end. With rents now rising at a seven-year high, historically low rates and moderating price growth are likely to entice more buyers to enter the market in upcoming months.”
The Pending Home Sales Index of National Association of Realtors (NAR) is based on contracts that are signed in November. The NAR had also revised its index in the month of October to a slightly lower level.
These contracts turn into sales after a month or two, analysts say. The contracts increased in the South, Northeast and West but dropped in the Midwest.
The housing market of the United States has been recovering in fits and starts from its near collapse situation during the 2007-09 Great Recession. The sales’ pace suffered a setback in mid-2013 when the higher rates of interest shocked the labor market.
Meanwhile, several economists had made forecast of total pending home sales increasing 0.5 percent in the month of November from the previously reported level in October.
The contracts were found moving upward trend of 4.1 percent as compared to October last year.