For the fourth time in a row, pending home sales have fallen below their year-earlier levels amid persistent inventory issues. A decline from a month earlier was led by the Midwest.
The seasonally adjusted Pending Home Sales Index preliminarily came in at 106.4 as of April. An index of 100 is equal to the average level during 2001.
A more than 1 percent drop from the preceding month’s upwardly revised level was recorded for the index, which represents the volume of contract signings.
Compared to the downwardly revised index for the same month last year, pending home sales have fallen more than 2 percent. It was the fourth consecutive year-over-year decline.
The National Association of Realtors reported the the data
based on a 20 percent sample of all transactions.
NAR Chief Economist Lawrence Yun noted in a written statement that there is robust demand, frequent multiple offers and listings that are flying off the shelf. But severe housing shortages are holding back sales.
“The unfortunate reality for many home shoppers is that reaching the market will remain challenging if supply stays at these dire levels,” Yun said.
The economist warned that the combination of rising interest rates, increasing home prices
and escalating gas prices could deter some potential home buyers who are already contending with inventory shortages.
On a month-over-month basis, pending home sales in the Midwest fell more than 3 percent from March, giving the region the biggest loss and an index of 98.5. A 1 percent drop left the South’s index at 127.3, and the West retreated less than a percent to 94.4.
In the Northeast, the index was unchanged at 90.6.
