US pending home sales for August 0.6% versus 1.0% expected

• Prior month -5.5%
• Pending home sales for August 0.6% versus 1.0% expected
• Index comes in at 70.6 versus 70.2 last month
• Month over month, contract signings rose in the Midwest, South and West but dropped in the Northeast.
• Compared to one year ago, pending home sales decreased in the Northeast, Midwest and South but increased in the West.

Details:

• The Pending Home Sales Index (PHSI) increased to 70.6 in August, down 3.0% year-over-year.
• The Northeast PHSI dropped -4.6% to 61.6 in August, down 2.2% year-over-year.
• The Midwest index rose +3.2% to 70.0 but declined 3.6% from last year.
• The South PHSI increased +0.1% to 83.6, down 5.3% year-over-year.
• The West index grew +3.2% to 58.0, up 2.7% year-over-year.
• Housing affordability has improved due to falling mortgage rates, expected to continue as long-term mortgage rates approach 6%.
• Mortgage savings on a $300,000 loan could be around $300 per month compared to a few months ago.

NAR Chief Economist Lawrence Yun said:

“A slight upward turn reflects a modest improvement in housing affordability, primarily because mortgage rates descended to 6.5% in August. However, contract signings remain near cyclical lows even as home prices keep marching to new record highs.”

The mortgage rates are now down near 6.10%. That is down from 7.8% at its peak in the 4Q of 2023.

This article was written by Greg Michalowski at www.forexlive.com.