"The supply limitation appears to be the main factor holding back contract signings in the past month"
- NAR chief economist Lawrence Yun
The number of home buyers in the U.S. signing contracts to purchase previously owned properties dropped unexpectedly last month after three months of gains, showing uneven progress in the housing market. According to the National Association of Realtors, a gauge of contracts for the purchase of previously owned homes fell 4.3% in December from November to a reading of 101.7. Analysts, however, expected a 0.5% gain. Despite the decline, the reading remained well above the last year's figures, as the housing market continued to boost the weak economic recovery.
"Our expectation is that the U.S. housing market will deliver more of the same in 2013 -- increased start activity, modest home price appreciation, and continued cleansing of the stock of shadow inventory," Michael Gapen, a New York-based senior economist at Barclays Plc, said in a research note before the report.
"The supply limitation appears to be the main factor holding back contract signings in the past month," said NAR chief economist Lawrence Yun. "Supplies of homes costing less than $100,000 are tight in much of the country, so first-time buyers have fewer options."
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