However, the future remains uncertain for the housing recovery. After hitting their highest level in almost four years, existing-home sales declined in September, according to the National Association of Realtors.
Specifically, total existing-home sales, which include single-family homes, townhomes, condominiums and co-ops, declined 1.9 percent to 5.29 million. These figures are still 10.7 percent above the 4.78 million-unit pace in September 2012.
The NAR also reported that pending home sales declined for the fourth-consecutive month in September, as higher mortgage interest rates and higher home prices curbed buying power.
NAR’s Pending Home Sales Index, a forward-looking indicator based on contract signings, fell 5.6 percent to 101.6 in September from a downwardly revised 107.6 in August, and is 1.2 percent below September 2012, when it was 102.8.
The index is at the lowest level since December 2012, when it was 101.3.
Also, according to Freddie Mac, the national average rate for a 30-year, conventional, fixed-rate mortgage rose to 4.49 percent in September from 4.46 percent in August, and is the highest since July 2011, when it was 4.55 percent; the rate was 3.47 percent in September 2012.
Walter Molony, a spokesman for the NAR, said the association expects the upward trend of rising mortgage rates and home prices to continue long term.
“The main friction to the market is the unnecessarily restrictive mortgage underwriting standard coupled with limited inventory in many areas,” he said.
“We’re seeing the sales of volume come down a bit in the fourth quarter and then leveling out in 2014. For this year, we’re going to see a nice increase in sales in the range of 11-12 percent but going into 2014, we’re looking at sales to just flat-line,” Molony noted.
Molony added that NAR is projecting the 30-year fixed mortgage rate to trend upward going from an average of 4.2 percent this year to 5.3 percent in 2014.