Pending purchases of U.S. previously owned homes unexpectedly rose in July, a respite in an otherwise lackluster resale market bogged down by high financing costs and prices.
The National Association of Realtors' index of contract signings to purchase previously owned homes edged up 0.9% to 77.6, the highest in three months, the group reported Wednesday. The median estimate in a Bloomberg survey of economists called for a 1% drop.
"The small gain in contract signings shows the potential for further increases," Lawrence Yun, NAR's chief economist, said in a statement. "However, rising mortgage rates and limited inventory have temporarily hindered the possibility of buying for many."
Compared with a year earlier, pending home sales were down nearly 14% on an unadjusted basis.
Rising mortgage rates, which surged this month to the highest level since 2000, have dealt a severe blow to affordability. With so many homeowners staying put, having locked in much lower rates years earlier, there's a scant number of available properties. That's kept
The pending-home sales report is a leading indicator of existing-home sales given houses typically go under contract a month or two before they're sold.
By region, July pending sales rose the most in the West as meaningful price declines in the past year lured buyers, Yun said. They also increased in the South, but fell in the Northeast and the Midwest.
