American Property buying slows as Fed turn off the taps

Fewer Americans signed contracts in December to buy previously occupied homes, suggesting a slowdown in real estate according to the The National Association of Realtor(USA)

 Pending home sales fell to the lowest point since October 2011. 

The NAR's  seasonally adjusted pending home sales index dropped 8.7 percent last month to 92.4. 

That's the seventh straight monthly decline for the index, which previews upcoming sales.

 Rising mortgage rates and price increases crimped sales in recent months.

 Cold weather in December also stalled home purchases.

 Sales of previously occupied homes totaled 5.1 million in 2013

That's the highest in 7 years, but it's still below the 5.5 million that is consistent with a healthy housing market. 

The average interest rate on a 30-year mortgage dropped to 4.32 percent this week from 4.39 percent the previous week. Rates surged about 1.25 percentage points from May through September, peaking at 4.6 percent. 

That increase occurred after Federal Reserve Chairman Ben Bernanke indicated that the Fed would start to slow its bond-buying program before the end of the year. The Fed has reduced its monthly bond purchases from $85 billion to $65 billion in its last two policy meetings. The program is intended to push down longer-term interest rates and encourage more borrowing, spending and hiring.