Chicago's NAR says US Pending home sales climb to 7-month high, mortgage filings fall

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Chicago's NAR says US Pending home sales climb to 7-month high, mortgage filings fall

National Association of Realtors, a Chicago, Illinois-headquartered commercial association of real estate agents alongside affiliates having had more than a 1.4 million members across the United States, said in a statement that US pending home sales - the number of contracts to purchase previously-owned US homes - bounced back to a seven-month peak in August, though a record rise in home prices alongside rapidly building price pressures around the economy kept a lid on housing market momentum.

On top of that, other US homebuilding data released on Wednesday had unfurled that applications for mortgages had faltered last week, as mortgage rates spiked higher shortly after the US Fed had hinted that it would more likely to start a tapering off fiscal support for the economy as early as by November this year with an increasing likelihood of a rate-hike by mid- to late-2022, even as lumber prices had fallen sharply from a record peak hit in May.

As a shimmering ray of hope at the end of tunnel for a scuffling US housing market, the National Association of Realtors also had been quoted saying that supplies could be improved by fall.

US pending home sales rebound in August

According to NAR data, the Chicago-based real estate trade association’s index for Pending Home sales on signed contracts, climbed 8.1 per cent to 119.5, remarking the strongest since January 2021 after two straight months of declines, as new contracts rose across all four regions.

However, MBA (Mortgage Bankers Association) said applications for new home loans tumbled 1.2 per cent last week. According to US mortgage buyer Freddie Mac, US 30-year fixed-rate mortgages perked up to 2.88 per cent last week, while 15-year fixed-rate home loans edged 0.03 per cent higher to 2.15 per cent.

Meanwhile, addressing to a cautious optimism over a gradual ease in supply constrain, a chief US economist at High Frequency Economics in White Plains, New York, Rubeela Farooqi said, “Supply constraints that are boosting prices are impacting affordability and have been a headwind for buyers.

Gradually easing supply constraints should be a positive, although affordability concerns could temper sales in the very near term”.