Residential Real Estate News
Affordability and U.S. Election Stalling U.S. Consumers Home Buying Decisions
U.S. Home Sales Recovery Did Not Occur This Summary as Expected, Says NAR
In July 2024, pending home sales dropped by 5.5%, as reported by the National Association of Realtors. All four U.S. regions experienced monthly declines in transactions. Compared to last year, the Northeast saw an increase, while the Midwest, South, and West showed decreases.
The Pending Home Sales Index (PHSI), which forecasts home sales based on contract signings, fell to 70.2 in July, marking the lowest level since the index's inception in 2001. Year-over-year, pending transactions declined by 8.5%. A PHSI of 100 corresponds to the contract activity level in 2001.
"A sales recovery did not occur in midsummer," said NAR Chief Economist Lawrence Yun. "The positive impact of job growth and higher inventory could not overcome affordability challenges and some degree of wait-and-see related to the upcoming U.S. presidential election."
Regional Breakdown of U.S. Pending Home Sales Data:
- The Northeast PHSI dropped by 1.4% from the previous month to 64.6 but was up by 2.4% compared to July 2023.
- The Midwest index decreased by 7.8% to 67.8 in July, representing an 11.4% decline from a year ago.
- The South PHSI fell by 6.5% to 83.5 in July, down 11.5% year-over-year.
- The West index declined by 3.8% in July to 56.2, a 6.0% drop from July 2023.
"In terms of home sales and prices, the New England region has performed relatively better than other regions in recent months," added Yun. "Current lower, falling mortgage rates will no doubt bring buyers into the market."
