WASHINGTON – Pending sales of existing U.S. homes fell 1.7 percent in October but held above the low hit in July, suggesting the housing market is stabilizing, a real estate trade association said on Monday.
It was a steeper drop than analysts had expected. The median forecast of a Reuters poll of economists was for an October index level of 108.6.
The October level was 13.2 percent below the year-earlier level, a slimmer drop than the 13.6 percent year-on-year decline posted in September.
The trade association noted the index had been range-bound in recent months and cited the narrowing in the decline from year-ago levels as a sign that the beleaguered U.S. housing market was stabilizing.
"It's important to focus on where the housing market is now — it appears to be stabilizing, and comparisons with an unsustainable boom mask the fact that home sales remain historically high," David Lereah, chief economist for the trade association, said in a statement.
The index covers pending sales of existing single-family units, condominiums and co-ops. A home sale is pending when a contract has been signed but the transaction has not closed.
Pending sales typically close within one or two months of contract signing.