Despite an unexpected surge in new-home-sales, pending-home-sales puked in December, tumbling 3.8% MoM (after falling 2.3% MoM in November)…
Source: Bloomberg
That is the biggest MoM drop since Feb 2021 and pushed the YoY drop back into the red (down 6.64%).
“Pending home sales faded toward the end of 2021, as a diminished housing supply offered consumers very few options,” Lawrence Yun, NAR’s chief economist, said in a statement.
“Mortgage rates have climbed steadily the last several weeks, which unfortunately will ultimately push aside marginal buyers.”
New home sales were the only segment to see an increase in sales in December…
Sales dropped in every region:
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Northeast fell 1.2% m/m; Nov. fell 0.1%
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Midwest fell 3.7% m/m; Nov. fell 6.1%
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South fell 1.8% m/m; Nov. fell 1%
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West fell 10% m/m; Nov. fell 2.1%
This may be a big problem for Powell as pending home sales are often looked to as a leading indicator of existing-home purchases given properties typically go under contract a month or two before they’re sold
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