Home shoppers signed 1.5% fewer contracts to buy existing homes in April compared to March, according to the National Association of Realtors’ Pending Home Sales Index. Sales were 2% lower than in April 2018, June 16, 2012.
Pending sales are an indicator of future closures and are therefore the most up-to-date measure of activity in house sales. After a sharp rise in March, a small monthly profit was expected.
“Although the latest monthly figure shows a slight decline in contract signatures, mortgage applications and consumer confidence have risen steadily,” said Lawrence Yun, NAR’s chief economist. “It is inevitable that sales in a few months.”
Buyers had the advantage of lower mortgage rates this spring. The average rate of 30-year fixing rose over 5% last November, but fell closer to 4% in March and then remained stable at 4.3% for most of April when these contracts were signed.
Buyers also see house prices cool, which has both negative and positive effects on the market. Prices are still higher than a year ago, but profits are shrinking every month. While this helps with affordability, it also stimulates fears that in some markets a house bought today will actually lose value in the coming year.
This is particularly true in overheated markets such as Seattle, Denver, Los Angeles and San Francisco, where the supply of real estate for sale is increasing.
“Home price appreciation was the strongest at the bottom end, since the storage conditions for homes under $ 250,000 were constantly tight. The price conditions are soft at the upper end, especially in High-tax states such as Connecticut, New York and Illinois,” said Yun.
New tax laws have limited the deduction of homeowners for property taxes. This has outweighed housing markets in higher tax states.
For comparison: there is only a 3.3 month supply of homes for sale under $ 250,000 in a National, but an 8.9-month supply of homes priced at $1 million and higher.
Regional, Realtors ” pending home Sales index in the northeast dropped by 1.8% monthly and 2.1% below a year. In the Midwest the index increased by 1.3% per month, but was 2.4% per year lower. In the south it fell 2.5% monthly and 1.8% annually. In the West, it fell by 1.8 percent and was thus 1.5 percent lower than the previous year’s figure.