Contract activity continued to slow in April, marking sixth consecutive months of declines. According to the National Association of Realtors, pending home sales were down 3.9 percent last month and 9.1 percent year-over-year.
“Pending contracts are telling, as they better reflect the timelier impact from higher mortgage rates than do closings,” said Lawrence Yun, NAR’s chief economist. “The latest contract signings mark six consecutive months of declines and are at the slowest pace in nearly a decade.”
With mortgage rates rising, Yun forecasts existing-home sales to decline some 9 percent in 2022 and home price appreciation to moderate to 5 percent by year’s end.
“The escalating mortgage rates have bumped up the cost of purchasing a home by more than 25 percent from a year ago, while steeper home prices are adding another 15 percent to that figure,” Yun continued.
Month-over-month, the pending sales in the Northeast fell 16.20 percent in April, a 14.3 percent drop from a year ago. In the Midwest, pending sales rose 6.6 percent last month, but were down 2.8 percent year-over-year.
Pending home sales in the South dipped 4.7 percent in April, and were down 10.3 percent compared to April of last year. Out West, pending sales slipped 4.3 percent in April, and 10.5 percent year-over-year.