U.S. December Pending Home Sales - Four straight gains erased
Pending home sales have seen a surprising 9.3% decline in December, completely erasing four straight gains which led a recent acceleration in existing home sales.
This data suggests existing home sales could lose momentum in Q1, perhaps due to a likely pause in fed easing, and follows a softer January NAHB homebuilders’ index. However weekly MBA house purchase data has been strong, though strong gains here in the last two weeks may be in part corrective from a weak outcome in the week that included New Year’s Day. The four week average looks similar to those seen in November and December.
The combined release for September and October construction spending leaves trend remaining fairly flat, with a 0.6% decline in November and a 0.5% increase in November, residential spending leading both moves. There may be some acceleration in residential spending in Q4 but the pending home sales data casts some doubt on whether it will persist in Q1.
