|According to The National Association of Realtors’ chief economist, Lawrence Yun, rising interest rates is having an impact on the slowing sales rates (but this doesn’t seem to be the case in New Jersey).
That being said, along with shrinking inventory, sales are projected to slow down a bit.
In addition to the rise in mortgage rates and inventory shortage, there doesn’t seem to be too much of an impact being felt on home prices, which are, at some regions, at 15-year highs.
According to the National Association of Realtors’ report, pending home sales fell in November to their lowest level in almost a year. The Pending Home Sales Index, a forward-looking indicator based on contract signings, fell 2.5% to 107.3 in November from 110 in October. With the November decrease, the index is now 0.4% below November 2015 (107.7) and at its lowest reading since January 2016 (105.4).
According to The National Association of Realtors’ data, the Northeast saw monthly and annual pending sales gains in November, which climbed again 0.6% to 97.5 in November, and is now 5.7% above a 2015.
The Midwest’s index fell 2.5% to 103.5 in November, and is now 2.4% lower than November 2015.
The South’s index fell 1.2% to an index of 118.7 in November, and now is 1.3% lower than 2015.
The West’s index fell 6.7% in November to 101, and is now 1% lower than the same time in 2015.
At this point, the National Association of Realtors is projecting “only a small gain in home sales” for 2017.
The National Association of Realtors’ outlook for 2017 expects the housing market will be stabilized by the stronger wage growth as a result of the 2 million net new job additions that are expected next year. Still, the inventory shortage is expected to continue to have an impact on choices available to buyers.