Existing-home sales dropped in December, marking two consecutive months of declines.
- The Pending Home Sales Index (PHSI) dropped by 3.8% to 117.7 in December. Transactions fell by 6.9%, YoY.
- Al four major US regions reported both month-over-month and year-over-year declines in contract activity.
- Lawrence Yun, NAR’s chief economist stated that pending home sales slowed down toward the close of 2021, as a diminished housing supply gave consumers very few options.
- Yun further stated that mortgage rates have risen steadily over the last several weeks, which is likely to push aside marginal buyers.
- Yun projects the 30-year fixed mortgage rate to rise to 3.9% by Q4 and existing-home sales to drop by 2.8% to 5.95 million units.
For the full-year of 2022, the housing inventory is projected to continue improving and contribute to a slower home price increase. Housing starts to grow to 1.65 million units and home prices to grow by 5.1%.
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Source: National Association of Realtors
