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Pending home sales in the U.S. surged in November, reaching their highest point since February 2023, driven by improved affordability as lower mortgage rates and rising wages encouraged buyers. Contracts for previously owned homes rose 3.3% month-on-month and 2.6% year-on-year, exceeding economists expectations. Gains were recorded across all major regions, with more inventory choices adding to buyer interest. The average 30-year fixed mortgage rate stood at 6.18%, near the lowest levels in over a year. The data signals a potential rise in closed sales in the coming months.
Pending home sales in the United States experienced a significant rise in November, marking their strongest level in nearly three years since February 2023. Contracts to purchase previously owned homes increased by 3.3% from October and 2.6% compared with the same month last year, according to the National Association of Realtors (NAR). Economists had expected only a 1% increase, making the actual rise notably stronger than anticipated. Advertisement
The chief economist at NAR stated that homebuyer momentum is growing, with this month showing the strongest performance of the year after adjusting for seasonal factors. Improved housing affordability, supported by lower mortgage rates and wages increasing faster than home prices, has encouraged buyers to test the market. Greater inventory compared with last year has also contributed to the rise in contract activity.
Regional data showed gains across the Northeast, Midwest, South, and West, indicating broad-based improvement rather than isolated market strength. Pending sales are considered a leading indicator for existing home sales, suggesting that closed transactions may increase in the near term.
Mortgage rates have edged lower since the Federal Reserve resumed interest rate cuts earlier in the autumn. The average rate for a 30-year fixed mortgage stood at 6.18%, near the lowest since fall 2024. While further reductions remain uncertain due to a likely pause from the central bank, current rates have helped improve affordability and attract more buyers.
Data from industry surveys also indicate that real estate professionals expect buyer traffic to rise in the coming months. However, overall market activity may still be limited by inventory shortages and broader economic factors.
Source Reuters
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