U.S. Pending Home Sales Rise Much Less Than Expected In December

(RTTNews) - Pending home sales in the U.S. inched slightly higher in the month of December, the National Association of Realtors revealed in a report on Thursday.

NAR said its pending home sales inched up 0.1 percent to 106.8 in December from a downwardly revised 106.7 in November. Economists had expected the index to climb by 0.8 percent.

A pending home sale is one in which a contract was signed but not yet closed. Normally, it takes four to six weeks to close a contracted sale.

With the modest monthly increase, the index is up by 4.2 percent compared to a year ago, reflecting the sixteenth consecutive month of year-over-year growth.

Lawrence Yun, NAR chief economist, said, "Warmer than average weather and more favorable inventory conditions compared to other parts of the country encouraged more households in the Northeast to make the decision to buy last month."

"Overall, while sustained job creation is spurring more activity compared to a year ago, the ability to find available homes in affordable price ranges is difficult for buyers in many job creating areas," he added.

The modest uptick by the pending home sales index reflected strength in the Northeast, where pending home sales jumped by 6.1 percent.

On the other hand, pending home sales tumbled 2.1 percent in West, slumped 1.1 percent in the Midwest and fell 0.5 percent in the South.

NAR said existing home sales are expected to reach around 5.34 million in 2016, reflecting a 1.5 percent increase from 2015.

The national median existing home price for this year is expected to increase between 4 and 5 percent after climbing 6.8 percent last year, NAR added.