Wet weather dampens us property sales

Photo: JohnSeb

Pending home sales were essentially unchanged in January, according to the National Association of Realtors, but were 9 per cent below January 2013. It follows December's figures, which were the lowest since November 2011.

Total existing-home sales fell last month to the lowest level in 18 months, dropping 5.1 per cent to a seasonally adjusted annual rate of 4.62 million in January from 4.87 million in December - 5.1 per cent below the 4.87 million-unit pace in January 2013.

While previous months has seen sales slow down due to climbing prices and rising mortgage rates, the weather is another factor working against buyers.

Lawrence Yun, NAR chief economist, comments: “Disruptive and prolonged winter weather patterns across the country are impacting a wide range of economic activity, and housing is no exception.

"Some housing activity will be delayed until spring. At the same time, we can’t ignore the ongoing headwinds of tight credit, limited inventory, higher prices and higher mortgage interest rates. These issues will hinder home sales activity until the positive factors of job growth and new supply from higher housing starts begin to make an impact.”

Existing-home sales are expected to be weak in the first quarter, while prices will continue to rise from limited inventory. Yun cites construction as one solution for the problem, producing more inventory and taming price growth. Until the weather clears up, though, the air may be stagnant in the sales market for some time.