After modest increases in February and March, pending home sales dipped in April to their third-lowest level over the past year, according to NAR. The Pending Home Sales Index declined 1.3 percent to 106.4 in April from an upwardly revised 107.8 in March. With a decrease in March, the index is down on an annualized basis of 2.1 percent, for the four month in a row.
Lawrence Yun, NAR chief economist stated that low inventory has caused the housing market to dip this spring as demand for buying remains robust. “Listings are typically going under contract in under a month, and instances of multiple offers are increasingly common and pushing prices higher. The unfortunate reality for many home shoppers is that reaching the market will remain challenging if supply stays at these dire levels.”
Looking to the summer months, Yun believes that rising mortgage rates and gas prices could lead to additional hesitation among some would-be buyers.
“The combination of paying extra at the pump, while also needing to save more for a down payment because of higher rates and home prices, may weigh on the psyche of those looking to buy. If more new and existing homes are listed for sale, it would allow home prices to moderate enough to stave off inflationary pressures and higher rates.”
For the full news release, click here.