Us property sales drop in december

Photo credit: Michael Patrick

The NAR Pending Home Sales Index plunged 8.7 per cent in December 2013, taking transactions 8.8 pe cent below the previous year. The figures, which reflect contracts but not closings, are now at the lowest level since October 2011.

Lawrence Yun, NAR chief economist, highlighted several factors as working against buyers: “Unusually disruptive weather across large stretches of the country in December forced people indoors and prevented some buyers from looking at homes or making offers.

“Home prices rising faster than income is also giving pause to some potential buyers, while at the same time a lack of inventory means insufficient choice. Although it could take several months for us to get a clearer read on market momentum, job growth and pent-up demand are positive factors.”

Total existing home sales in 2014 are expected to total approximately 5.1 million, the same as 2013, although limited supply and rising mortgage rates are helping to slow down transactions. Prices are forecast to continue climbing, but at a slower rate of 5.4 per cent in the coming year, as the market returns to normal conditions follow a speculative period from overseas investors.