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Pending home sales fell in December by nearly five percent. Despite low mortgage rates, the conditions weren’t stellar for last-minute breakout performance during the holidays: Home supply hit a record low, and December is already historically the slowest month of the year. Still, last month outperformed the same time in 2018 by 4.6 percent, boosted by increased demand as people get a head start on spring home shopping. The housing shortage is expected to continue this year, but experts say that increased construction and continued low interest rates will somewhat alleviate the shortage.
Pending home sales, which measure signed contracts, not closings, dropped 4.9% in December compared with November, as the supply of homes hit a record low during the month.
Sales were projected to rise 1% month to month.
December is historically the slowest month of the year in the housing market. Despite the month-to-month drop, though, 2019 ended up slightly stronger than the year before. Pending home sales were 4.6% higher last month than in December 2018, according to the National Association of Realtors.
Regionally, pending sales in the Northeast fell 4% for the month and were 0.1% lower than a year ago. In the Midwest, sales dropped 3.6% monthly but were 1.3% higher annually. Pending home sales in the South decreased 5.5% monthly but were 7.4% stronger compared with a year ago. Pending sales in the West fell 5.4% monthly but were up 7% annually.
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