MW: Pending home sales jump 1.6% in December as demand hangs tough
A gauge of pending home sales rose in December, a sign of enduring demand despite housing headwinds.
The National Association of Realtorsâ€™ index jumped 1.6% to 109. Thatâ€™s 0.3% higher than a year ago. The December jump was much greater than the 0.6% rise forecast by economists surveyed by Econoday.
The index forecasts future sales by tracking real estate transactions in which a contract has been signed, but the deal has not yet closed.
Decemberâ€™s contract activity was mixed regionally. The index tracking the Northeast fell 1.6%, and the one covering the Midwest dipped 0.8%. Pending home sales jumped 2.4% in the South, and surged 5% in the West.
Supply is the big question for 2017, NAR noted in a release. The group is concerned that tighter inventory will continue to push home prices higher even as borrowing costs rise.
The increasingly competitive market is a concern for the Realtors and other industry participants because itâ€™s hard for first-time buyers to break in.
In December, there was more inventory of higher-priced homes than in other price ranges, a sign that more affordable properties are being snatched up quickly.