Fewer Americans signed contracts to purchase previously owned homes in February as limited inventory and access to credit held back a more robust recovery in housing.
The index of pending home sales fell 0.4 percent to 104.8, the second-highest level since April 2010, after a revised 3.8 percent increase the prior month, the National Association of Realtors reported today in Washington. The median forecast in a Bloomberg survey called for a 0.3 percent drop.
A smaller number of properties for sale may be hindering buyers with access to credit, while others with limited cash for a down payment are finding it difficult to take advantage of historically low interest rates. At the same time, a pickup in property values may encourage more people to list their homes as the spring selling season gets under way.
“Lending is excessively tight and continues to be,” Benjamin Ayers, an economist with Nationwide Mutual Insurance Co. in Columbus, Ohio, said before the report. “It’s limiting the expectations for growth.”
Estimates of 37 economists in the Bloomberg survey ranged from a drop of 3 percent to an increase 4 percent. The Realtors’ group revised January’s data from a previously reported increase of 4.5 percent.
Stocks fell after the Standard & Poor’s 500 Index approached a record high yesterday. The S&P 500 dropped 0.6 percent to 1,554.75 at 10:07 a.m. in New York.
Two of four regions saw a decrease in February pending home sales, today’s report showed, led by a 2.5 percent drop in the Northeast. Pending sales climbed 0.4 percent in the Midwest and 0.1 percent in the West.
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