Signed contracts for previously owned homes rose less than expected last month, as the national housing market struggled to gain momentum.
Pending home sales inched up 0.3 percent in September from a month earlier, the National Association of Realtors said Monday. The report missed analyst expectations of a 1 percent gain.
Higher prices and mortgage rates this year blunted the torrid housing recovery of 2013 and priced many families out of the market. The slight sales increase last month, which followed a 1 percent decline in August, signals many buyers remain handcuffed.
“Tiny steps in a positive direction are a far cry from the robust housing activity many analysts expected — and the Fed hoped for — after a weak start to the year,” Sterne Agee chief economist Lindsey M. Piegza said in a research note.
However, the Realtors said the recent trend of falling mortgage rates should allow more families to purchase a house. The average rate for a 30-year fixed mortgage sank to 3.92 percent last week, the lowest of the year, according to mortgage-finance giant Freddie Mac.
Pending home sales fell 0.8 percent in the West last month. The only other region to post a decline was the Midwest, where sales dropped 1.2 percent.
Pending sales reflect contracts signed but not closed. The deals usually become final in one or two months.