T
he housing market is showing signs of improvement, with pending home sales reaching a 21-month high in November. According to the National Association of REALTORS, contract signings rose 2.2% month over month, marking the fourth consecutive increase and a nearly 7% jump from last year. This uptick is attributed to buyers recalibrating their expectations on mortgage rates and taking advantage of more available inventory.

    Mortgage rates have averaged above 6% for two years, causing buyers to no longer wait for or expect significant rate drops. As the market shifts away from a seller's market, buyers are in a better position to negotiate. Several recent indicators suggest a healthier market: existing-home sales rose 5% annually, the median home price climbed 4.7%, and new-home construction increased 7%.

    While some markets will outperform due to local job gains and inventory supply, contract signings were up annually in all four major regions of the US in November. The South saw the most notable monthly increase, with pending home sales up 5.2%. Despite a decline in the Northeast, contract signings are still up nearly 6% compared to last year.

    Leading economists predict a rosy real estate outlook for 2025, with some markets expected to see significant sales increases due to local job gains and new inventory supply.