Pending home sales recorded no change in April, according to the National Association of Realtors (NAR). The Pending Home Sales Index (PHSI), a forward-looking indicator of home sales based on contract signings, remained at 78.9.
While the PHSI was unchanged month over month, the April reading was 20.3% lower compared with April 2022. An index of 100 is equal to the level of contract activity in 2001.
“Not all buying interests are being completed due to limited inventory,” says NAR chief economist Lawrence Yun. “Affordability challenges certainly remain and continue to hold back contract signings, but a sizable increase in housing inventory will be critical to get more Americans moving.”
In the Northeast, the PHSI dropped 11.3% compared with March to a reading of 59.1, a 21.8% decrease on a year-over-year basis. The Midwest index improved 3.6% to 78.4 in April, down 21.4% from a year ago.
The South PHSI increased marginally by 10 basis points to 99.6 in April but fell 16.7% from the prior year. In the West, the index improved 4.7% to 62.2 on a month-over-month basis but fell 26.% compared with April 2022.
“Minor monthly variations in regional activity are typical,” says Yun. “However, cumulative results over many years clearly point toward a much greater number of home sales in the South.”
While the South’s index is only slightly lower than the average level of contract activity from the base year of 2001, the Midwest’s activity has decreased 22% in the same time period, and the Northwest and West regions are both 40% lower than in 2001.
