Today, the National Association of Realtors (NAR) released their Pending Home Sales Report for December showing that pending home sales plunged with the seasonally adjusted national index dropping a whopping 8.7% from November and falling 8.8% below the level seen in December 2012.
Meanwhile, the NARs chief economist Lawrence Yun is blaming weather, rising home prices and low inventory for the slumping results:
"Unusually disruptive weather across large stretches of the country in December forced people indoors and prevented some buyers from looking at homes or making offers, ... Home prices rising faster than income is also giving pause to some potential buyers, while at the same time a lack of inventory means insufficient choice. Although it could take several months for us to get a clearer read on market momentum, job growth and pent-up demand are positive factors."
The following chart shows the seasonally adjusted national pending home sales index along with the percent change on a year-over-year basis as well as the percent change from the peak set in 2005 (click for larger version).