The numbers: U.S. pending-home sales fell 4% in November, which is the sixth straight monthly drop, according to the index released Wednesday by the National Association of Realtors (NAR).
The index was last at this level in the midst of the pandemic lockdown, in April 2020.
Analysts polled by the Wall Street Journal had forecast the pending home sales index to drop by 1.8%.
Contract signings fell in all regions across the country.
Pending home sales reflect transactions where the contract has been signed for an existing-home sale, but the sale has not yet closed.
Economists view it as an indicator for the direction of existing-home sales in subsequent months.
Key details: Compared with a year earlier, transactions were down by 37.8%.
On a monthly basis, pending sales fell in all four major U.S. regions, led by the Northeast, where the index fell by 7.9%, followed by the Midwest, the South and the West.
But pending home sales fell the most since last November in the West, by 45.7%.
Pending home sales have fallen in all but one month in 2022.
Big picture: The housing market continues to stumble through 2022, as elevated mortgage rates keep buyers out of the market.
Buyers are finding it hard to find an existing home for sale, as sellers hold on to their homes tied to ultra-low mortgage rates.
November’s data is also tied to the period of time when mortgage rates were above 7%.
What the realtors said: “With mortgage rates falling throughout December, home-buying activity should inevitably rebound in the coming months and help economic growth,” NAR Chief Economist Lawrence Yun said.
What they’re saying: “Housing markets have entered a winter freeze,” George Ratiu, senior economist at Realtor.com, said in a statement.
“With prices for existing homes still elevated … and mortgage rates above 6%, homebuyers are finding much of today’s real estate landscape inaccessible,” he added.
Ratiu estimated that monthly mortgage payment for a median-priced home has gone up by $780 since last year.
Market reaction: The Dow Jones Industrial Average
and the S&P 500
were mixed in early trading on Wednesday. The yield on the 10-year Treasury note
rose above 3.8%.
(Realtor.com is operated by News Corp subsidiary Move Inc., and MarketWatch is a unit of Dow Jones, also a subsidiary of News Corp.)