The pending home sales index was down for a 5th month in row, pointing to further declines for final sales of existing homes which have already fallen for 2 months in a row. The National Association of Realtors attributes some of the October weakness to the rise underway in home prices.
Meanwhile speaking of escalating home prices the FHFA house price index rose 0.3 percent after increasing 0.4 percent in August. The latest figure came in below analysts' forecast for a 0.4 percent gain. The year over year rate for September came in at 8.5 percent, matching the pace in August. Further evidence of escalating values is shown in Case Shiller whose 20-city index rose an adjusted 1.0 percent in September vs monthly gains of 0.9 percent and 0.6 percent in the prior two months. Very respectable gains swept all 20 cities for the second month in a row, led this time by Atlanta at plus 1.9 percent followed by a string of cities out West where S&P says there's talk now of a housing bubble. The year over year rate tells the same story -- accelerating appreciation.
Interestingly as the values increase sales are decreasing. With new limits to qualifying for a mortgage coming soon to a lender near you this trend should continue for a little longer but it will need to come to an end as less buyers are qualified to pay the higher prices.
