US contracts to buy homes decline, still a January record
The number of Americans who signed contracts to buy homes declined again as inventory struggles to keep up with demand
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.The number of Americans who signed contracts to buy homes declined again with the number of properties for sale not matching the surging demand in the U.S.
The National Association of Realtors’ index of pending home sales fell 2.8% to 122.8, which was still a record high for the month. December's index, which was also a record high, was revised upward.
Despite the recent declines, contract signings are still 13% ahead of where they were last year at this point, a sign that the housing market remains strong despite the widespread economic damage caused by the pandemic.
Contract signings are considered a barometer of purchases that will take place the next one to two months as the spring buying season opens.
Regionally, the West led the declines with a 7.8% drop, followed by the Northeast's 7.4% retreat. Contract signings fell 0.9% in the Midwest and were up a slight 0.1% in the South. However, pending home sales are still up significantly in all four regions compared with last year.
Prospective buyers are jumping into the market to try and take advantage of historically low interest rates, but prices for both existing and new homes have risen significantly the past year with the number available close to record lows.
The supply of new homes on the market could get a boost this spring. The Commerce Department reported last week that applications for building permits spiked 10.4% in January and according to the Realtors group, there have been eight straight months of increases for single-family home building permits.