Pending Home Sales Slump For 6th Straight Month As "Affordability Constrains Would-Be Buyers"

After disappointment for new- and existing-home sales (as well as starts and permits), pending-home-sales managed to rebound from May's drop, rising a better than expected 0.9% MoM.

The month-over-month gain in contract signings was broad-based with all four major U.S. regions showing gains. Meantime, Portland, Oregon, Seattle and San Jose, California, were among several cities showing big increases in new listings, according to the NAR. While the pickup in inventory is welcome and could help bring down prices, the group says more supply is needed to meet demand.

However, pending home sales fell 2.5% YoY - the 6th straight month of declines. (down 4./0% on a NSA basis)...

“The positive forces of faster economic growth and steady hiring are being met by the negative forces of higher home prices and mortgage rates,” Lawrence Yun, NAR’s chief economist, said in a statement.

“Even with slightly more homeowners putting their home on the market, inventory is still subpar and not meeting demand. As a result, affordability constraints are pricing out some would-be buyers and keeping overall sales activity below last year’s pace.”

As a reminder, economists consider pending sales a leading indicator because they track contract signings. Purchases of existing homes are tabulated when a deal closes, typically a month or two later.