Pending home sales increased strongly month on month in the US in January
Pending home sales in the United States rebounded strongly in January, including a large surge in the South, according to the latest index from real estate agents.
All four major regions saw growth last month and overall sales were up 4.6% compared with December, the data from the National Association of Realtors shows. But year on year sales were down by 2.3%, the thirteenth month in a row of annual decreases.
The January rise had been expected, according to Lawrence Yun, NAR chief economist. ‘A change in Federal Reserve policy and the reopening of the Government were very beneficial to the market,’ he said.
Of the four major regions, three areas experienced a decline compared to one year ago, while the Northeast enjoyed a slight growth spurt.
Yun also said higher rates discouraged many would-be buyers in 2018. ‘Buyers are now returning and taking advantage of lower interest rates, while a boost in inventory is also providing more choices for consumers,’ he explained.
Denver-Aurora-Lakewood, Seattle-Tacoma-Bellevue, San Diego-Carlsbad, Los Angeles-Long Beach-Anaheim, and Nashville-Davidson-Murfreesboro-Franklin, saw the largest increase in active listings in January compared to a year ago.
The positive pending home sales figures in January are predicted to continue. ‘Income is rising faster than home prices in many areas and mortgage rates look to remain steady. Furthermore, job creation will help lift home buying,’ said Yun.
In 2019, Yun forecasts for existing home sales is around 5.28 million, down 1.1% from 2018 while the national median existing home price this year is expected to increase around 2.2%. In 2018, existing sales declined 3.1% and prices rose 4.9%.
A breakdown of the figures shows that sales in the Northeast rose 1.6% and were 7.6% above a year ago. In the Midwest, they rose 2.8% in January, and are 0.3% lower than January 2018.
Sales in the South jumped 8.9% in January but this is still 3.1% lower than this time last year, while in the West sales increased 0.3% but are 10.1% below January 2018.