Sales of previously owned homes in the United States improved solidly in August, with lower interest rates pulling buyers back into the market.
According to the National Association of Realtors (NAR) Pending Home Sales Report, pending home sales increased by 4% from the month prior and 3.8% year-over-year.
There were gains in the Midwest (8.7%), South (3.1%) and West (5%) month-over-month, while they decreased in the Northeast by 11%. Year-over-year, there were increases across all regions.
The Realtors Confidence Index survey for August also found that 19% of NAR members expect an increase in buyer traffic in the next three months, up from 16% last month and unchanged from a year ago.
At the same time, 19% expect an increase in seller traffic, which is down from 21% last month and up from 18% the same time last year.
NAR chief economist Lawrence Yun said lower mortgage rates are enabling more home buyers to go under contract.
"In the Midwest, low mortgage rates combined with high levels of affordability are attracting more buyers compared to other regions,” Yun said.
This comes as the rate on the popular 30-year mortgage rate is at an 11-month low.
At the same time, the labour market is weakening with job gains averaging only 29,000 per month in the past three months to August, compared to 82,000 during the same period last year.
