Friday, March 27th10.9°C
24867
24285

Signed contracts to buy US homes plunge 8.7 per cent last month, evidence of housing slowdown

WASHINGTON - Fewer Americans signed contracts to buy previously occupied homes in December, suggesting a slowdown in real estate. Pending home sales fell to the lowest point since October 2011.

The National Association of Realtors said its seasonally adjusted pending home sales index dropped 8.7 per cent last month to 92.4. That's the seventh straight monthly decline for the index, which previews upcoming sales. A one- to two-month lag usually exists between a signed contract and a completed sale.

Rising mortgage rates and price increases crimped sales in recent months. Cold weather in December also stalled home purchases.

"People are disinclined to go house-hunting in severe weather conditions," said Ian Shepherdson, chief economist at Pantheon Macroeconomics. "We expect something of a rebound in January, but this month's cold weather means it is unlikely all the ground lost will be recovered."

Last month's decline was so steep that it led to a year-over-year drop of 8.8 per cent. The number of signed contracts tumbled in the Northeast, Midwest, South and West in December.

Still, the housing market benefited from historically low mortgage rates for much of 2013.

Sales of previously occupied homes totalled 5.1 million last year, the trade group said last week. That's the highest in seven years, but it's still below the 5.5 million that is consistent with a healthy housing market.

The average interest rate on a 30-year mortgage dropped to 4.32 per cent this week from 4.39 per cent the previous week. Rates surged about 1.25 percentage points from May through September, peaking at 4.6 per cent. That increase occurred after Federal Reserve Chairman Ben Bernanke indicated that the Fed would start to slow its bond-buying program before the end of the year.

The Fed has reduced its monthly bond purchases from $85 billion to $65 billion in its last two policy meetings. The program is intended to push down longer-term interest rates and encourage more borrowing, spending and hiring.

The Canadian Press


Read more Business News

25185


Recent Trending




Today's Market
S&P TSX14812.42-57.38
S&P CDNX681.43+1.87
DJIA17712.66+34.43
Nasdaq4891.22+27.86
S&P 5002061.02+4.87
CDN Dollar0.7928-0.0082
Gold1196.30-8.80
Oil48.43-3.00
Lumber282.40-3.60
Natural Gas2.62-0.05

 
Okanagan Companies
Pacific Safety0.125-0.005
Knighthawk0.010.00
QHR Technologies Inc1.50+0.00
Cantex0.03-0.01
Anavex Life Sciences0.219+0.009
Metalex Ventures0.04-0.01
Russel Metals24.50-0.18
Copper Mountain Mining1.13+0.00
Colorado Resources0.125+0.010
ReliaBrand Inc0.006-0.001
Sunrise Resources Ltd0.045+0.000
Mission Ready Services0.255+0.020
Decisive Dividend Corporation1.80+0.02

 





FEATURED Property
2223722Spectacular view ! --Great Location
$785,000
more details
Click here to feature your property
Please wait... loading


CRA Notice of Assessment

Many Canadians rush to file their taxes on time each year and don’t think about it until the next year. One of the most overlooked notices received from the CRA annually is the annual Notice of ...


Medical confidential?

If ICBC asks your doctor for your information you may wonder: Can ICBC ask my doctor for my medical information? Can ICBC request a medical report from my doctor without my consent? What is ICBC entit...


Stay out of sales limbo!

Have you ever had a series of good meetings with a prospect … gathered all kinds of information … and given what you thought was a great presentation … only to receive a response ...

_








Member of BC Press Council


25534