The US housing market is closing the year with its strongest performance since early 2023. According to data released on Dec. 29, pending home sales climbed 3.3% in November, marking the fourth consecutive month of growth and reaching the highest level since February 2023. This consistent upward trend signals a thawed market where buyers are …
Housing Market Hits 3-Year High: Pending Sales Surge 3.3% in November
The US housing market is closing the year with its strongest performance since early 2023. According to data released on Dec. 29, pending home sales climbed 3.3% in November, marking the fourth consecutive month of growth and reaching the highest level since February 2023.
This consistent upward trend signals a thawed market where buyers are finally stepping off the sidelines.
The “Affordability” Window Reopens
Lawrence Yun, NAR’s chief economist, attributes this “homebuyer momentum” to a critical shift in economic conditions. For the first time in years, the math is starting to work in the buyer’s favor:
- Wage Growth vs. Prices: Wages are now rising faster than home prices, improving purchasing power.
- Mortgage Relief: Lower mortgage rates have combined with increased inventory to help buyers “test the market”.
- National Growth: On a yearly basis, pending sales are up 2.6% nationally.
The Regional Breakdown: West vs. South
While every region saw growth, the recovery is unevenly distributed, with the West seeing an explosion in immediate activity and the South leading in long-term stability.
| Region | Month-over-Month Growth (Nov) | Year-over-Year Growth |
|---|---|---|
| West | +9.2% (Leader) | +2.4% |
| South | +2.4% | +3.3% (Leader) |
| Northeast | +1.8% | +1.8% |
| Midwest | +1.3% | +2.2% |
Inside the Deal: Who is Buying?
The Realtors Confidence Index reveals a changing buyer profile. While first-time buyers pulled back slightly, investors and cash buyers are increasing their footprint.
- Investors Rising: Purchases for non-primary residences (investors or second homes) jumped to nearly 18%, up from 13% a year ago.
- Cash is King: A significant 27% of all transactions were all-cash deals, insulating those buyers from interest rates entirely.
- First-Time Dip: First-time buyers made up 30% of the market, a slight decrease from 32% in October.
- Virtual Buyers: Buying unseen remains niche but steady; 6% of buyers purchased a home based solely on a virtual tour.
Market Friction: What to Expect
For those entering the market now, conditions remain competitive but functional.
- Speed: Homes are spending an average of 36 days on the market.
- Competition: The average home receives 2.2 offers, and more than 18% of homes still sell above the asking price.
- Closing Reliability: The vast majority of deals hold together. Only 6% of contracts were terminated in the last three months, though 15% faced delayed settlements.
Outlook: Optimism Returns
Sentiment among real estate professionals is cautiously improving. Over 22% of NAR members expect buyer traffic to increase in the next three months—an uptick from October, though still slightly below levels seen a year ago.
