September data for the US housing market has been positive so far (with new home sales soaring and existing home sales ‘off the lows’) as mortgage rates trend lower offering some affordability respite for buyers.
However, today’s pending home sales data disappointed, printing unchanged MoM versus expectations of a 1.2% MoM rise (after an upwardly revised 4.2% MoM rise in August)…
Source: Bloomberg
On the bright side, on a YoY basis, sales rose 1.5% – the best since Nov 2024.
The total pending home sales Index pushed further ‘off the record lows’, but is hardly
Source: Bloomberg
“A record-high stock market and growing housing wealth in September were not enough to offset a likely softening job market,” NAR Chief Economist Lawrence Yun said in a statement.
Nonetheless, “mortgage rates are trending toward three-year lows, which should further improve affordability, though the government shutdown could temporarily slow home sales activity.”
Moreover, the so-called “lock-in effect” – in which homeowners resist selling because of their existing low-rate mortgages – is waning and helping to boost inventory.
Source: Bloomberg
By region, contract signings on previously owned homes rose 1.1% in the South to the highest level since March.
Pending sales also climbed in the Northeast, while falling in the West and Midwest.
Pending-homes sales tend to be a leading indicator for previously owned homes, as houses typically go under contract a month or two before they’re sold.
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