Slow start in 2014 for California home sales

Pending home sales declined in December, indicating a slow start for the California housing market in 2014, according to the California Association of Realtors.

A “perfect storm” — a shortage of available homes for sale, rising interest rates, and higher home prices — kept prospective home buyers on the sidelines in December, pushing California pending home sales lower for the second straight month, L.A.-based CAR said in a statement.

California pending home sales fell in December, with the Pending Home Sales Index (PHSI) dropping 25.2 percent in December to reach 68.8, down from a revised index of 92 in November, based on signed contracts, CAR reported. The monthly decline was the second straight double-digit drop in the PHSI.

Pending sales were down 16.8 percent from the revised 82.8 index recorded in December 2012.

Pending home sales are forward-looking indicators of future home sales activity, providing information on the future direction of the market, according to CAR.