U.S. home sales post another decline
STORY: Sales of previously owned homes in the U.S. dropped for a fourth straight month in February, weighed down by a persistent shortage of properties. And with increasing mortgage rates and high house prices, sales could remain sluggish.
The National Association of Realtors said on Friday its Pending Home Sales Index, based on signed contracts, fell 4.1% last month to 104.9. Pending home sales declined in the South, Midwest and West, but rose in the Northeast.
Economists polled by Reuters had forecast contracts rebounding 1.0%. Pending home sales decreased 5.4% in February on a year-on-year basis.
While sales of previously owned homes tumbled in February, they remained above their level from before the health crisis.
The inventory of used houses is at record lows. Shortages and expensive building materials have made it harder for builders to ramp up construction, leading to double-digit growth in house prices.
Mortgage rates surged in February and have continued to push higher after the Federal Reserve last week raised its policy interest rate by 25 basis points, the first hike in more than three years. They are likely to continue accelerating as Fed Chair Jerome Powell on Monday said the U.S. central bank must move "expeditiously" to raise rates and possibly "more aggressively" to combat inflation.
