Pending home sales edge up 0.2% in October

Economists had estimated, according to Bloomberg, that pending home sales rose 1% month-on-month. The index has increased 3.9 percent over the past 12 months.

Still, continued strengthening in several local markets is still fueling improved demand, said Lawrence Yun, chief economist for the National Association of Realtors, in a statement.

The Realtors reported last week that finalized sales have risen 3.9 percent from a year ago, even as buyers have fewer choices because the number of listings on the market has dropped 4.5 percent.

Pending home sales have been trending modestly lower since the summer. Home sales are being constrained by tight inventories, which are pushing up prices.

Reflecting ongoing inventory shortages and affordability pressures, NAR said existing home sales growth is expected to be tempered to 3 percent in 2016. Home prices are expected to slightly moderate from a 6 percent increase in 2015 to 5 percent next year.

The National Association of Realtors®, “The Voice for Real Estate”, is America’s largest trade association, representing 1 million members involved in all aspects of the residential and commercial real estate industries. An index of 100 is equal to the average level of contract activity during 2001.

The latest data on pending home sales are expected at the top of the hour.

Pending sales, which are based on contract signings, rose 20 basis points in October to 107.7 after declining the two previous months, the trade group said. The outturn was below both (1.5%) consensus (1.0%) expectations.