Pending home sales in US sink 7.7% in January

March 04, 2009|Associated Press

WASHINGTON - The number of homebuyers who agreed to purchase an existing home sank to a new low in January as economic woes turned them away from the staggering housing market, the National Association of Realtors said yesterday.

The group's seasonally adjusted index of pending sales contracts fell 7.7 percent to 80.4 in January from a downwardly revised December reading of 87.1.

January's reading was far worse than the 85.1 economists expected, according to Thomson Reuters, and came in below the previous record low of 83.1 in November.

"It really does all come back to the job market," said Mike Larson, a real estate analyst with Weiss Research, in a note. "The latest evidence suggests we're seeing little relief on that front."

The index tracks signed contracts to buy previously owned homes. Typically there is a one- to two-month lag between a contract and a done deal, so the index is a barometer for future home sales.

Pending sales were down in every region but the West, where soaring foreclosures have made prices especially attractive for buyers. The index there was up more than 2 percent from December. Pending sales in the Northeast, however, were down about 13 percent, while they fell 12 percent in the South and 9 percent in the Midwest.