New US second-hand housing contracts rose unexpectedly in May, ending a negative six-month losing streak as higher mortgage rates continued to curb demand.
In particular, the index for pending home sales rose 0.7% in May to 99.9, after a two-year low in April, the National Association of Brokers (NAR) announced today. Analysts in a Reuters poll expected the index to fall by 3.7%.
On an annual basis, however, outstanding sales fell by 13.6% in May.
“Despite the small gains in sales from last month, the housing market is clearly in transition,” said Lawrence Yun, chief economist at NAR. “The contracts have fallen significantly from a year earlier due to much higher interest rates today,” he added.