‘Uncertainty’ Plagues Market as Contract Signings Drop
October marked the 10th consecutive month of decreases in contract signings—not a good sign for the housing market as it starts the traditionally slower months of sales.
“The recent rise in mortgage rates have reduced the pool of eligible home buyers,” says Lawrence Yun, NAR’s chief economist.
He says the market is following a similar pattern to 2013, when interest rates jumped from 3.5 percent to 4.5 percent. It took 11 months—from November 2013 to September 2014—for sales to rebound back, and only when rates started decreasing again.
“This time, interest rates are not going down, in fact, they are probably going to increase even further,” Yun says.