Pending Home Sales Increased 8.3% In December

Key Insights

• Pending Home Sales easily beat analyst expectations, supported by falling mortgage rates. 
• Existing home sales are projected to grow at a robust pace in 2024 and 2025.
• The National Association of Realtors expects that the 30-year fixed mortgage rate will be in the 6% – 7% range for most of 2024.

On January 26, the National Association of Realtors released Pending Home Sales report for December. The report indicated that Pending Home Sales increased by 8.3% on a month-over-month basis, compared to analyst consensus of +1.5%.

On a year-over-year basis, Pending Home Sales increased by 1.3%, while analysts expected that they would drop by 3.4%.

The National Association of Realtors forecasts a 13% increase in existing home sales in 2024 and a 15.8% increase in 2025. The annual median home price is projected to increase by 1.4% in 2024 and 2.6% in 2025.

The forecasts imply that Fed will cut interest rates four times while the 30-year fixed mortgage rate will be in the 6% – 7% range for most of 2024.

The National Association of Realtors commented: “The housing market is off to a good start this year, as consumers benefit from falling mortgage rates and stable home prices.”

U.S. Dollar Index has started to rebound as traders reacted to the better-than-expected Pending Home Sales report. Currently, U.S. Dollar Index is trying to settle above the 103.40 level.

Gold continues its attempts to settle below the $2015 level. Treasury yields are moving higher, which is bearish for gold markets.

SP500 is mostly flat as traders are cautious ahead of the weekend. Currently, SP500 is stuck in a tight 4890 – 4900 range.

For a look at all of today’s economic events, check out our economic calendar.