Summary: Pending home sales inched up by 1.6% in August according to the National Association of Realtors.
The Pending Home Sales Index increased in August after the previous months of declines with a 107.3 reading.
Existing Home Purchase Contracts:
- Northeast: +1.4 percent
- Midwest: +0.6 percent
- West: +3.1 percent
- South: +1.4 percent
Pending home sales across the country were 2.5% higher year over year showing continued improvement in the housing market albeit at a slower pace. A low supply of available homes for sale continue to limit the number of existing home sales and pressure home prices higher. Bidding Wars are still common throughout most of Washington and Oregon, especially in metropolitan areas.
The Pending Home Sale report is seen as a forward looking indicator as homes under contract lead to actual sales in the coming months.
The Fed And The Housing Market
The Federal Reserve recently slashed interest rates by another quarter point in its meeting this past September after doing the same in the summer. If the central bank cuts interest rates back even further at its next meeting, it may again turn to buying U.S. Treasury bonds to provide added stimulus.
The Fed has repeatedly stated that continued monitoring of economic trends would weigh heavily on its decision if and when to modify its current stimulus program.
Continued cuts in the Federal Reserve’s interest rate influences the short-term lending rate, which can impact the affordability of lending. In general, when the Fed cuts rates, adjustable-rate mortgage (ARM) payments will decrease.
Sammamish Mortgage is a local, family-owned company based in Bellevue, Washington. We serve the entire state, as well as the broader Pacific Northwest region that includes Idaho, Colorado, and Oregon. We offer a wide variety of mortgage programs and products with flexible qualification criteria. Please contact us if you have mortgage-related questions.