The housing market experienced a setback in July as pending home sales, a leading indicator of future home sales based on signed contracts, fell by 5.5%. This marks the lowest level since tracking began in 2001.
All four major U.S. regions saw a decline in contract signings compared to the previous month. While the Northeast saw a year-over-year increase, the Midwest, South, and West all experienced decreases.
NAR Chief Economist Lawrence Yun attributed the decline to affordability challenges and some uncertainty surrounding the upcoming presidential election, which offset positive factors such as job growth and increased housing inventory.
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Yun noted that New England’s housing market has been performing better than other regions and expressed optimism that falling mortgage rates would attract more buyers.
The data suggests that while there are some positive signs in the housing market, significant challenges persist, particularly around affordability. The upcoming election and its potential impact on the economy add another layer of uncertainty.
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