US pending home sales fell a sharp 8.6% mom in June of 2022, much worse than market forecasts of a 1.5% drop. This was in contrast to increasing 0.4% in May. Mortgage data has been weak as escalating mortgage rates and housing prices are impacting affordability for potential buyers. US new home sales for June declined 8.1% month-over-month to a seasonally adjusted annual rate of 590,000 units (consensus 670,000) from a downwardly revised 642,000 (from 696,000) in May
National Association of realtors pending home sales for month of June 2022
- US Pending Home Sales (M/M) Jun: -8.6% (est -1.0%; prev R 0.4%)
- Pending Home Sales NSA (Y/Y): -19.8% (est -13.5%; prev R -12.3%)
According to NAR, buying a home in June was about 80% more expensive than in June 2019. Nearly a quarter of buyers who purchased a home three years ago would be unable to do so now. “Home sales will be down by 13% in 2022 but should start to rise by early 2023”,
Pending sales retreated in all four major regions:
- Midwest (-3.8%),
- Northeast (-6.7%),
- South (-8.9%),
- West (-15.9%).
- Year-over-year, transactions shrank 20%.
“Contract signings to buy a home will keep tumbling down as long as mortgage rates keep climbing, as has happened this year to date. There are indications that mortgage rates may be topping or very close to a cyclical high in July. If so, pending contracts should also begin to stabilize”, NAR Chief Economist Lawrence Yun said.
From The TradersCommunity News Desk