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NAR: October Pending Sales Fell 1.9% in the South

Nationwide, pending home sales fell 1.5% in October, but falling mortgage rates and a growing number of new builds are a harbinger of optimism.

WASHINGTON – Pending home sales fell to their lowest levels in two decades in October, with the South seeing a moderate decline compared to the rest of the nation, the National Association of Realtors® said Thursday.

The Pending Home Sales Index (PHSI) – an indicator of signed contracts on existing homes – decreased 1.9% to 85.6 in October in the South region, which includes Florida. The year-over-year decline in the South was 7.1%.

The Northeast posted a monthly gain of 2.7% from the previous month to 64.8, although representing a loss of 6.5% from October 2022. The Midwest PHSI decreased 0.4% to 73.8 in October, down 10.3% year-over-year. The West index fell 6.0% in October to 51.8, dipping 10.8% from October 2022.

Lawrence Yun, NAR’s chief economist, said October was a challenging month, with mortgage rates at their highest (near 8%) and existing home contract signings at their lowest in more than 20 years.

“Recent weeks’ successive declines in mortgage rates will help qualify more homebuyers, but limited housing inventory is significantly preventing housing demand from fully being satisfied,” he said. “Multiple offers, of course, yield only one winner, with the rest left to continue their search.”

However, resourceful potential homeowners aren’t letting the limited housing inventory stop them. They’re moving to new builds, Redfin said. Nationwide, 30.6% of U.S. single-family homes for sale in the third quarter were new construction – the highest share of any third quarter on record. That’s up from 28.9% one year earlier and 25% two years

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