Pending Home Sales Index Drops, Mortgage Loan Activity Slows

This isn’t exactly positive news for those fearing more of a decline in the housing market:

Pending sales of existing U.S. homes fell 0.5 percent in November - but did at least hold above the low hit in July, suggesting the housing market is stabilizing, a real estate agents‘ trade association said on Thursday.

The National Association of Realtors said its Pending Home Sales Index, based on home purchase loan contracts signed in November, fell to 107.0 from 107.5 in October.

Analysts had been expecting a modest rise in the index. The November level was 11.4 percent below the year-earlier level, a shorter drop than the 13.2 percent year-on-year decline posted in October.

The trade association read the smaller decrease from year-ago levels as a sign that the troubled U.S. housing market was stabilizing.

“The index is pointing toward fairly stable home sales in the near future,” David Lereah, chief economist for the trade association said in a statement. “That is another indicator that home sales likely bottomed-out in September.”

Home sales climbed the two months after September.

The index covers pending sales of existing single-family units, condominiums and co-ops. A sale is pending when a regular or bad credit home loan contract has been signed, but the transaction has not closed.