The Pending Home Sales Index in the United States rose 3.3% month-over-month to 79.2 in November, hitting the highest level since February 2023. The increase was significantly higher than economists' general expectations.
Signs of recovery have emerged in the U.S. second-hand housing market.
According to data released Monday by the National Association of Realtors (NAR), the Pending Home Sales Index for November in the U.S. rose 3.3% month-over-month to 79.2, reaching its highest level since February 2023. The increase was significantly higher than economists' general expectations.
This index measures the number of homes with signed purchase contracts but not yet completed transactions. A survey of economists by the media showed that this increase was only lower than one forecast, indicating a relatively broad-based market recovery.
Lawrence Yun, chief economist at NAR, stated in a press release, 'Momentum among homebuyers is strengthening,' primarily due to improved affordability and an increase in available housing options compared to last year. Data shows that second-hand home signings have risen for four consecutive months, matching the performance during the booming phase of the housing market during the pandemic.
The latest data further supports several economists' assessments that the housing market will gradually improve through 2026. Mortgage rates, which approached 7% in May this year, have fallen back to the range of 6.3% to 6.4%, while annual house price increases have also slowed significantly, supporting a slight rise in recent months' signing volumes.
However, opinions within the industry remain divided regarding the market outlook for next year. A recent survey covering nine market analysts revealed a wide range of forecasts for second-hand home sales growth, ranging from 1.7% to 14%, with the most optimistic forecast coming from NAR's Lawrence Yun.
Regionally, the NAR report showed that all four major regions of the U.S. recorded increases in signings in November, reaching their highest levels of the year. The Western region saw the largest increase, followed by the Southern region, which is also the largest housing transaction market in the U.S.
Industry insiders noted that pending sales of second-hand homes are generally considered a leading indicator of existing home sales, as contracts are typically signed one to two months before official completion. This round of rising signings may provide a positive signal for the trend in U.S. existing home sales in the coming months.
Editor/Stephen