Rounding out the August report haul, we now know that pending sales didn’t fare much better than existing-home sales last month. According to the National Association of Realtors, pending transactions slid 7.1 percent in August. Year-over-year, pending sales fell by 18.7 percent.
”Mortgage rates have been rising above 7 percent since August, which has diminished the pool of home buyers,” said Lawrence Yun, NAR chief economist. “Some would-be home buyers are taking a pause and readjusting their expectations about the location and type of home to better fit their budgets. It’s clear that increased housing inventory and better interest rates are essential to revive the housing market.”
The West Index fell 7.7 percent in August to 56.3, sinking 21.4 percent from August 2022.
“The Federal Reserve must consider the sharply decelerating rent growth in its consideration of future monetary policy. There is no need to raise interest rates,” said Yun. “Moreover, the government shutdown will disrupt some home sales in the short run due to the lack of flood insurance or delays in government-backed mortgage issuance.”