April pending-home sales were flat compared to March but down 20.3% from a year earlier as low inventory continued to cramp would-be homebuyer ambitions, the National Association of REALTORS® reported, citing its Pending Home Sales Index.
“Not all buying interests are being completed due to limited inventory,” NAR Chief Economist Lawrence Yun said in a press release. “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 sales, in which the contract has been signed but the transaction has not closed, are considered a leading indicator and generally precede existing-home sales by a month or two.
First American Deputy Chief Economist Odeta Kushi said the flat reading of NAR’s pending index points to a slow start to the crucial spring homebuying season.
“Affordability remains significantly constrained compared with one year ago,” Kushi said. “Additionally, higher rates are keeping existing homeowners rate locked-in and limiting inventory. You can’t buy what’s not for sale.”
Regionally, pending home sales slid in the Northeast but rose in the Midwest, West and South.
“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.”