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http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-01-05T150121Z_01_WAT004653_RTRIDST_0_FINANCIAL-PENDING-HOMESALES-URGENT.XMLWASHINGTON, Jan 5 (Reuters) - Pending sales of U.S. homes fell in November to the lowest level in 10 months, showing a slowdown has begun in the housing market after a five-year rally, the National Association of Realtors said on Thursday.
The Pending Home Sales Index, based on contracts signed in November, stood at 120.6 in November, down 2.5 percent from both October and a year ago. The reading marked the lowest level for the index since matching that level in January 2005.
David Lereah, the group's chief economist, said the index remains at a high level, but that the housing market has begun to transition.
"We are clearly experiencing a market transition, moving from a prolonged boom to a more balanced period of sustainable sales," Lereah said.
"In other words, home sales have been peaking for the last five years and we will land on a high plateau in 2006 -- a market that will be healthy for both buyers and sellers," he said. "Investment fundamentals for housing remain solid, preserving generally favorable affordability conditions while offering solid returns as well as a place to live."
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