Story at a glance

The number of pending home sales in the United States declined by 4.9 percent last month, according to the National Association of Realtors.

Not every part of the country saw the same level of home sale decline.

The Northeast and West saw upticks in pending home sales in January, but not enough to bump up their year-over-year rate.

Pending home sales dropped by nearly 5 percent last month, according to the National Association of Realtors.

Month-over-month contract signing increased in the Northeast and Western parts of the country while the South and Midwest reported declines.

All regions of the U.S have seen a decline in year-over-year home sales, according to the NAR.

The NAR’s Pending Home Sales Index (PHSI), an indicator of home sales based on contract signings, decreased nationally to 74.3 last month. An index of 100 is equal to the level of home sale contract activity that took place in 2001, according to the NAR.

"The job market is solid, and the country's total wealth reached a record high due to stock market and home price gains," said NAR Chief Economist Lawrence Yun.

"This combination of economic conditions is favorable for home buying. However, consumers are showing extra sensitivity to changes in mortgage rates in the current cycle, and that's impacting home sales."

Overall, year-over-year pending home sale transactions dropped by 8.8 percent.

In the Northeast, the PHSI increased by 0.8 percent from January to 63.6, a decline from 5.5 percent from the same time last year.

In the West, the PHSI rose by 0.5 percent in January to 61.1, a decrease of 7.0 percent of January 2023.

Meanwhile, in the Midwest, the PHSI decreased by 7.6 percent to 73.7 last month, down by 11.6 from a year earlier.

In the South, the PHSI declined 7.3 percent to 88.5 in January, dropping by 9.0 percent from 2023.

"Southern states and those in the Rocky Mountain time zone experienced faster job growth compared to the rest of the country," said Yun.

"As a result, long-term housing demand is increasing more significantly in these regions. However, the timing and number of purchases will largely depend on the prevailing mortgage rates and inventory availability."