The Pending Home Sales Index (PHSI) dropped 1.3 percent to 106.4 in April from an upwardly revised 107.8 in March, the National Association of Realtors (NAR) said on Thursday.
With the decrease, the index, a leading indicator to measure signed contracts to buy existing homes, has been down by 2.1 percent on an annualized basis for the fourth straight month.
According to statistics released by the NAR, all major regions saw no gain in contract activity in April.
The PHSI remained at 90.6 in April in the Northeast, 2.1 percent below a year ago; and decreased 3.2 percent to 98.5 in the Midwest, 5.1 percent lower than April of 2017.
Meanwhile, pending home sales declined 1 percent to 127.3 in the South in April, 2.7 percent higher than last April; and inched backward 0.4 percent to 94.4 in the West, 4.6 percent below a year ago.
Lawrence Yun, NAR chief economist, attributes the hindrance on the housing market this spring to severe housing shortages in much of the country.
But as the demand for buying a home remains very robust, "listings are typically going under contract in under a month, and instances of multiple offers are increasingly common and pushing prices higher," he said.
Heading into summer, if low supply and swift price growth were not enough of a headwind for the housing market, Yun believes that rising mortgage rates and gas prices could lead to 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," he said.
Yun forecasts that existing-home sales in 2018 will increase 0.5 percent to 5.54 million units, up from 5.51 million units in 2017 and the national median existing-home price will increase around 5.1 percent. In 2017, existing sales increased 1.1 percent and prices rose 5.7 percent.
The NAR is America's largest trade association, representing 1.3 million members involved in all aspects of the residential and commercial real estate industries. Enditem
With the decrease, the index, a leading indicator to measure signed contracts to buy existing homes, has been down by 2.1 percent on an annualized basis for the fourth straight month.
According to statistics released by the NAR, all major regions saw no gain in contract activity in April.
The PHSI remained at 90.6 in April in the Northeast, 2.1 percent below a year ago; and decreased 3.2 percent to 98.5 in the Midwest, 5.1 percent lower than April of 2017.
Meanwhile, pending home sales declined 1 percent to 127.3 in the South in April, 2.7 percent higher than last April; and inched backward 0.4 percent to 94.4 in the West, 4.6 percent below a year ago.
Lawrence Yun, NAR chief economist, attributes the hindrance on the housing market this spring to severe housing shortages in much of the country.
But as the demand for buying a home remains very robust, "listings are typically going under contract in under a month, and instances of multiple offers are increasingly common and pushing prices higher," he said.
Heading into summer, if low supply and swift price growth were not enough of a headwind for the housing market, Yun believes that rising mortgage rates and gas prices could lead to 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," he said.
Yun forecasts that existing-home sales in 2018 will increase 0.5 percent to 5.54 million units, up from 5.51 million units in 2017 and the national median existing-home price will increase around 5.1 percent. In 2017, existing sales increased 1.1 percent and prices rose 5.7 percent.
The NAR is America's largest trade association, representing 1.3 million members involved in all aspects of the residential and commercial real estate industries. Enditem
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