Pending U.S. Existing-Home Sales Fall on Higher Mortgage Rates

Contracts to purchase previously owned U.S. homes unexpectedly decreased in November on a sudden pickup in mortgage rates and limited inventory, according to figures released Wednesday from the National Association of Realtors in Washington.

The drop in contract signings was the first in three months and shows the impact of a surge in borrowing costs that began after the U.S. presidential election. While home-buying activity has been spurred by further labor-market improvement and promising gains in wages, the industry also has been challenged by limited inventory, particularly for lower-priced homes that could attract entry-level buyers. A further increase in mortgage costs risks reducing affordability as gains in property values have been outpacing income growth.