EconomyStockU.S. pending home sales race to record high in August

2 years ago415 min
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imageEconomic Indicators21 minutes ago (Sep 30, 2020 10:10AM ET)

(C) Reuters. Home for sale sign hangs in front of a house in Oakton, on the day the National Association of Realtors issues its Pending Home Sales for February report, in Virginia

WASHINGTON (Reuters) – Contracts to buy U.S. previously owned homes surged to a record high in August, suggesting housing market activity was gathering speed amid record-low mortgage rates.

The National Association of Realtors said on Wednesday its Pending Home Sales Index, based on contracts signed last month, jumped 8.8% to an all-time high of 132.8 last month. Economists polled by Reuters had forecast pending home contracts, which become sales after a month or two, rising 3.4% in August.

Pending home sales increased 24.2% from a year ago. The housing market has pressed ahead even as the COVID-19 pandemic has thrown millions out of work. The unemployment burden has fallen disproportionately on low-wage earners in the services industry, who tend to be young.

There has been a surge in demand for housing in suburbs and low-density areas as Americans seek spacious accommodation in the new work-from-home era.

The 30-year fixed mortgage rate is averaging below 3%, according to data from mortgage finance agency Freddie Mac (OTC:FMCC). Reports this month showed a surge in homebuilder confidence in September, and an acceleration in single-family home construction and sales of both new and previously owned homes in August.

Last month, pending home sales rose in all four regions.

U.S. pending home sales race to record high in August

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