Home sales perk up in November

Some homebuyers are no longer waiting for rates to drop before taking the plunge

Home sales perk up in November

Some homebuyers are no longer waiting for rates to drop before taking the plunge
Home_family_sold

Despite continuing high interest rates, home sales have shown signs of recovery in November as both pending home sales and new single-family home sales jumped last month.

November pending home sales rose 2.2%, reaching the highest level since February 2023, according to the Pending Home Sales Index (PHSI) from the National Association of Realtors (NAR). It was the fourth consecutive month in which pending home sales have increased. The index, which is a forward-looking indicator of home sales based on contract signings, was up 2.2% to 79.0 in November. Pending transactions improved year-over-year by 6.9%. An index of 100 is equal to the level of contract activity in 2001.

Sales of new single-family homes were also up in November, reaching a seasonally adjusted annual rate of 664,000, 5.9% higher than October’s annual rate of 627,000, according to the U.S. Census Bureau and the U.S. Department of Housing and Urban Development. New homes were fetching a median sales price of $402,600, and an average sales price of $484,800. The seasonally adjusted estimate for new houses for sale reached 490,000 in November. The number represents a supply of 8.9 months at the current sales rate.  

Month-over-month housing gains were seen in the country’s Midwest, South and West regions. The Northeast experienced a 1.3% fall in the number of November pending home sales. But the number was still up 5.6% from the previous year. The South PHSI jumped 5.2% to 94.5 in November, up 8.5% from a year ago. The West index rose 0.5% month over month to 64.3. However, the West was up 11.8% from November 2023. The Midwest index rose a scant 0.4% to 78.1, up 1.6% from a year ago.

“Consumers appeared to have recalibrated expectations regarding mortgage rates and are taking advantage of more available inventory,” said NAR Chief Economist Lawrence Yun. “Mortgage rates have averaged above 6% for the past 24 months. Buyers are no longer waiting for or expecting mortgage rates to fall substantially. Furthermore, buyers are in a better position to negotiate as the market shifts away from a seller’s market.”

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