After reporting a sharp pullback in U.S. pending home sales in the previous month, the National Association of Realtors released a report on Thursday showing pending sales were unexpectedly unchanged in April.
NAR said its pending home sales index came in unchanged at 78.9 in April after plunging by 5.2 percent in March. Economists had pending home sales to rebound by 1.0 percent.
A pending home sale is one in which a contract was signed but not yet closed. Normally, it takes four to six weeks to close a contracted sale.
“Not all buying interests are being completed due to limited inventory,” said NAR Chief Economist Lawrence Yun. “Affordability challenges certainly remain and continue to hold back contract signings, but a sizeable increase in housing inventory will be critical to get more Americans moving.”
Pending home sales came in unchanged as an 11.3 percent nosedive in the Northeast was offset by 3.6 percent and 4.7 percent jumps in the Midwest and West, respectively.
The pending home sales index for the South also inched up by 0.1 percent to 99.6, only slightly lower than 100, which is equal to the average level of contract activity during 2001.
“Minor monthly variations in regional activity are typical,” said Yun. “However, cumulative results over many years clearly point towards a much greater number of home sales in the South.”
He added, “The South’s pending home sales activity is similar to that of 2001, but the Midwest’s activity has decreased by 22% in that same period, and the Northeast and West regions are both about 40% lower than they were in 2001.”
On Tuesday, the Commerce Department released a separate report showing new home sales in the U.S. unexpectedly spiked to their highest level in a year in the month of April.
The report said new home sales jumped by 4.1 percent to an annual rate of 683,000 in April after surging by 4.0 percent to a revised rate of 656,000 in March.
Economists had expected new home sales to decrease to an annual rate of 670,000 from the 683,000 originally reported for the previous month.
With the unexpected increase, new home sales reached their highest level since hitting a rate of 707,000 in March of 2022.
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