Pending home sales take an April dive
The number of homes under contract fell in April, according to an industry index, casting further doubt on the housing market’s chances for a near-term recovery.
The National Assn. of Realtors said its index for pending home sales, which is based on the number of contracts signed each month, fell 11.6% and is down 26.5% from the same month last year. The index hit 81.9 last month. An index level of 100 is considered healthy.
Pending home sales surged a year ago because April 2010 was the last month in which buyers could sign a contract and qualify for a federal tax credit. Home sales and prices have been weak ever since that credit expired.
The poor April showing -- and a downwardly revised March figure -- does not bode well for the spring shopping season, typically the most important month for the housing market. Lawrence Yun, the chief economist for the real estate group, said in a news release that the drop was not encouraging.
“The pullback in contract signings is disappointing and implies a slower than expected market recovery in upcoming months,” Yun said. “The economy hit a soft patch in April from sharply rising oil prices, widespread severe weather with the heaviest precipitation in 20 years, and a sudden rise in unemployment claims.”
The pending homes sales index in the West fell 8.9% from the prior month. It rose 1.7% in the Northeast, fell 10.4% in the Midwest and dropped 17.2% in the South.
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-- Alejandro Lazo
Photo: A home under contract for sale in Massachusetts. Credit: Associated Press
