According to the National Association of Realtors, October reported a 7.5% rise in contract signings along with a prediction that 2021 home sales will hit a 15-year high. The rise in existing home sales should go over 6 million with the increase reported in October.
Although we have seen a slight increase in mortgage rates and a big increase in home prices, buyers are still very motivated. Sales prices will still increase but at a slower pace than over the past several months. Mortgage rates have also seen slight rises. The 30-year fixed mortgage rose to 3.10% on average according to Freddie Mac.
The U.S. National Association of Realtors’ Pending Home Sales Index all of the four U.S. regions have had increased contract activity month-over-month. The strongest increase was seen in South region and Midwest region.
“Motivated by fast-rising rents and the anticipated increase in mortgage rates, consumers that are on strong financial footing are signing contracts to purchase a home sooner rather than later,” says Lawrence Yun, NAR’s chief economist. “This solid buying is a testament to demand still being relatively high, as it is occurring during a time when inventory is still markedly low.”
The NAR’s U.S. Pending Home Sales Index is based on signed real estate contracts for existing single-family homes, condos, and co-ops. It is a leading indicator of housing activity, measures housing contract activity.