The National Association of Realtors is reporting that pending home sales decreased 1.7% in October, which they attribute to the decline in inventory and a small rise in mortgage rates in October from September. The NAR’s Pending Home Sales Index (a forward-looking indicator based on contract signings) decreased to 106.7 in October, down 1.7% from September. In addition, they reported that year-over-year contract signings were up 4.4%.
“We risk a lingering shortage of sufficient inventory if homebuilding only continues at its current pace over the next 20 years, when the U.S. population is projected to increase by more than 40 million over this period. Clearly, home builders must step in and construct more housing.” Said Lawrence Yun, the NAR’s chief economist.