What the “Supply Malaise” in Pending Home Sales Looks Like By Elliottwave International
We keep hearing that the real estate market is fine. But is that true?
Perhaps instead, let’s “hear” from Murray Gunn in the August 2024 Global Rates & Money Flows. It’s not a comforting picture.
Pending home sales in the U.S. are hovering at their lowest-ever level, seen in 2020 when the Covid pandemic hit the world. At that time, home sales slumped because nobody wanted to buy a new home. The current situation is a wee bit different.
In the U.S., as opposed to other countries, a long-term mortgage loan is standard, with 30-years being typical. When interest rates were rock bottom, people took that opportunity to lock in those borrowing costs. Since then, mortgage rates have soared and for people to move houses now, it would incur a much costlier loan. Therefore, it’s perhaps not so much a case of lower demand for houses, but that the supply has tailed off as people just do not want (or cannot afford) to move.
How will this impact you in the months and years to come?
Global Rates & Money Flows tracks the trends in rates and debt instruments in financial markets worldwide. Get the August issue on your screen in moments. Follow the link below to begin.
