March Pending Home Sales Down 5.2%

Pending home sales fell in March for the first time since November 2022, the National Association of Realtors reported Thursday.

The Pending Home Sales Index, a forward-looking indicator of home sales based on contract signings, fell by5.2% to 78.9 in March. Year over year, pending transactions dropped by 23.2%.

Three U.S. regions posted monthly losses, while the South increased. All four regions saw year-over-year declines in transactions. Pending home sales in the South rose by 0.2 percent in March to 99.6 but fell by nearly 20 percent from a year ago.

In the West, pending home sales fell by 8 percent in Marh to 59.4 percent and fell by 32.2 percent from a year ago. In the Northeast, pending sales fell by 8.1 percent to 66.6 and fell by 24.3 percent from a year ago. In the Midwest, pending sales fell by 10.7 percent to 75.7 and fell by 21.5 percent from a year ago.

“The lack of housing inventory is a major constraint to rising sales,” said NAR Chief Economist Lawrence Yun. “Multiple offers are still occurring on about a third of all listings, and 28% of homes are selling above list price. Limited housing supply is simply not meeting demand nationally.”

Yun said sales in the second half of the year should be notably better than the first half as job gains continue and more favorable mortgage rates are expected. “Sales of new homes are already matching 2019 pre-COVID activity and are expected to increase in 2023, largely due to plentiful inventory in this segment of the market,” he said.