Pending Home Sales Data Announced for December 2024
The National Association of Realtors released pending home sales data for December 2024 today. The report showed that the Pending Home Sales Index (PHSI) came in at 74.2, remaining up from last year’s cyclical low point of 70.2.
While the PHSI remained positive, the overall trend of pending home sales broke a four-month winning streak by ticking downward 5.5% in December 2024.
NAR Chief Economist Lawrence Yun, stated, “After four straight months of gains in contract signings, one step back is not welcome news, but it is not entirely surprising. Economic data never moves in a straight line. High mortgage rates have not significantly dented housing demand due to greater numbers of cash transactions.”
What are the regional differences?
When it came to sales by region, the southern part of the U.S. showed the greatest strength. The PHSI in the South only slipped 2.7% to 90.6 in December 2024. The Midwest index shrunk 4.9% in December, while the West index was down 10.3% and the Northeast was lower by 8.1%.
Yun said, “Contract activity fell more sharply in the high-priced regions of the Northeast and West, where elevated mortgage rates have appreciably cut affordability. Job gains tend to have greater impact in more affordable regions. It is unclear if heavier-than-usual winter precipitation impacted the timing of purchases.”
What’s next for the housing market?
While the housing market is a challenge to predict, a dip in home sales in December is hardly unexpected. However, experts have provided guidance as to what we could expect from the housing market in 2025.
Historically speaking, home inventory typically decreases in Winter. Fewer homes for sale can also result in a dip in home sales. The good news is that in the Spring homebuying season is right around the corner and more homes should be coming int the market.
The team at Rate is here to help you navigate a tricky housing market. If you have questions, we have team members available to support you. Also, if you know you need to start the homebuying process, we can assist you in getting a mortgage pre-approval.
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