Pending home sales as tracked by the National Association of Realtors slowed in August. The association blamed the slowdown on inventory conditions, higher interest rates, rising home prices, and continuing restrictive mortgage credit impacting the market.
The association's Pending Home Sales Index, a forward-looking indicator based on contract signings, was at 107.7 in August, from a downwardly revised 109.4 in July 2013. This is still up 5.8% from August 2012's 101.8. Pending sales have been above year-ago levels for 28 months running.
"Sharply rising mortgage interest rates in the spring motivated buyers to make purchase decisions, culminating in a six-and-a-half-year peak for sales that were finalized last month," said Lawrence Yun, NAR chief economist. "Moving forward, we expect lower levels of existing-home sales, but tight inventory in many markets will continue to push up home prices in the months ahead."
The association expects total 2013 existing-home sales to be up about 11% to nearly 5.2 million. Still, it sees little change in 2014, with sales forecast to increase less than 1%.
The national median existing-home price is expected to be up 11% to 12% for overall 2013. Prices are expected to be up 5% to 6% in 2014.
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