Real estate signs advertise new homes for sale in multiple new developments in York County, South Carolina, U.S., February 29, 2020. REUTERS/Lucas Jackson//File Photo

  • Pending home sales increase 8.1% in August
  • Contracts rise in all four regions
  • Applications for home purchase loans fall last week

WASHINGTON, Sept 29 (Reuters) – Contracts to buy U.S. previously owned homes rebounded to a seven-month high in August, but higher prices as supply remains tight are slowing the housing market momentum.

Other data on Wednesday showed applications for loans to buy a house fell last week as mortgage rates increased after the Federal Reserve signaled it would likely begin reducing its monthly bond purchases as soon as November. There are indications that supply could improve in the fall.

“Supply constraints that are boosting prices are impacting affordability and have been a headwind for buyers,” said Rubeela Farooqi, chief U.S. economist at High…

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