The number of houses going under contract in the U.S. continued its downward trend in April, falling for a sixth straight month amid rising mortgage rates, according to data from the National Association of Realtors published Thursday.
–The Pending Home Sales Index–a leading indicator of home sales based on contract signings–decreased 3.9% to 99.3 in April on month, its lowest level since April 2020.
–Economists polled by The Wall Street Journal expected sales to fall 2% on month.
–Pending home sales in April were 9.1% below the same month a year earlier.
–“The escalating mortgage rates have bumped up the cost of purchasing a home by more than 25% from a year ago, while steeper home prices are adding another 15% to that figure,” said Lawrence Yun, NAR’s chief economist. Existing-home sales are set to decline by 9% in 2022, and home price appreciation is expected to moderate to 5% by year end, he said.
–Pending home sales decreased in three of the four U.S. regions. Transactions fell the most in the Northeast, by 16.2% on month, followed by the South and the West, with declines of 4.7% and 4.3%, respectively. The index increased by 6.6% in the Midwest, according to the report.