Pending homes sales in November were unchanged from October, which was the lowest reading since the National Association of Realtors (NAR) began tracking data in 2001.
The Pending Home Sales Index (PHSI)—a forward-looking indicator of home sales based on contract signings—stayed at 71.6. An index of 100 is equal to the level of contract activity in 2001. On a year-over-year basis, pending transactions were down 5.2%.
“Although declining mortgage rates did not induce more home buyers to submit formal contracts in November, it has sparked a surge in interest, as evidenced by a higher number of lockbox openings," says Lawrence Yun, NAR chief economist.
The Northeast, Midwest, and West posted monthly gains in transactions while the South recorded a loss, NAR reports. All four U.S. regions saw year-over-year declines in transactions.
The South PHSI fell 2.3% to 83.2 in November, decreasing 6.5% from November of last year. The West index increased 4.2% in November to 54.0, a decrease of 4.9% from November 2022.
In the Northeast, the PHSI climbed 0.8% from last month to 64.4, a fall of 6.4% from this time last year. The Midwest index increased 0.5% to 76.2 in November, down 2.2% from one year ago.
"With mortgage rates falling further in December—leading to savings of around $300 per month from the recent cyclical peak in rates—home sales will improve in 2024," Yun says.
