PhotoIt wasn't much, but pending home sale were higher in October for a second straight month.

The National Association of Realtors reports its Pending Home Sales Index (PHSI) edged up 0.1% to 110.0 from a slight downward revision of 109.9 in September.

With last month's small increase, the forward-looking indicator based on contract signings is now 1.8% above its October 2015 level and at it's highest point since July.

"Most of the country last month saw at least a small increase in contract signings and more notably, activity in all four major regions is up from a year ago," said NAR Chief Economist Lawrence Yun. "Despite limited listings and steadfast price growth that's now carried into the fall, buyer demand has remained strong because of the consistently reliable job creation in a majority of metro areas."

Yun expects existing-home sales to close out the year at a pace of around 5.36 million, which surpasses 2015 and is the highest since 2006.

"Low supply has kept prices elevated all year and has put pressure on the budgets of buyers," Yun pointed out. "With mortgage rates expected to rise into next year and put added strain on affordability, sales expansion will be contingent on more inventory coming onto the market and continued job gains."

Regional showing

  • The PHSI in the Northeast eked out a 0.4% increase in October to 96.9, and is now 3.9% above a year ago.
  • In the Midwest the index jumped 1.6% to 106.3 for a year-over-year gain of 1.2%
  • Pending home sales in the South dipped 1.3% to an index reading of 120.1 and are still 0.8% above where they were the year before.
  • The index in the West climbed by 0.7% to 108.3 and is now 2.5% above a year ago.

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