Unusually cold weather, tight inventory and higher home prices all worked against buyers in December, driving down the number of pending home sales, the National Association of Realtors (NAR) reported.
A forward-looking indicator based on homes under contract, pending home sales declined 8.7 percent month over month in December from a downwardly revised November estimate and were down 8.8 percent on an annual basis, according to NAR.
“Unusually disruptive weather across large stretches of the country in December forced people indoors and prevented some buyers from looking at homes or making offers,” said Lawrence Yun, chief economist at NAR. “Home prices rising faster than income is also giving pause to some potential buyers, while at the same time a lack of inventory means insufficient choice.”
Though home sales have trended downwards in recent months, sales of existing homes in 2014 should roughly match 2013 levels, and their prices should rise 5.4 percent, NAR said.
“Although it could take several months for us to get a clearer read on market momentum, job growth and pent-up demand are positive factors,” Yun said.
