Housing Cool, 31% Decline in Pending Home Sales
The National Association of Realtors’ Pending Home Sales Index dropped to 31% compared to a year ago as mortgage rates increase. What isn’t declining is the median sales price of new homes which was $470,600 in September with an average sales price of $517,700, reports the U.S. Census Bureau. With the rate for a 30-year mortgage rising to 7.08% last week, the average monthly loan payment is now $1,000 more than a year ago, an economist for NAR reports on their blog. And though the number of buyers are far fewer, so are the number of active listings. Until inflation is tamed, mortgage rates will remain high keeping both supply and demand low. It’s not all bad news, however, as the GDP price index and the Personal Consumption Expenditures price index both decelerated during the third quarter of 2022. The GDP report indicates inflation is cooling, according to an analysis by the National Association of Home Builders. NAHB projects a “mild recession” in 2023.
PHOTO: In an upcoming video, I interview Megan Flewellyn (Association Executive of the Iowa City Area Association of Realtors), Bob Lamkins (local loan officer with HillsBank), and Adam Corpstein (Financial Advisor at Northwestern Mutual) about the market and state of the economy. See the video on my YouTube channel or via the link below: