May 31, 2012 (Chris Moore)
Contract signings for home purchases declined for the first time in three months in April, falling 5.5 percent to 95.5 from a downwardly revised 101.1 in March according to the National Association of Realtors® (NAR) Pending Home Sales Index (PHSI).
The decline in contract signings still left the Index 14.4 percent above April of last year when the Index was at 83.5.
Lawrence Yun, chief economist of NAR, stated, “Home contract activity has been above year-ago levels now for 12 consecutive months. The housing recovery momentum continues. Housing market activity has clearly broken out at notably higher levels and is on track to see the best performance since 2007.”
Three of the four regions in the Index experienced declines in their monthly level of sales contract activity while all of the regions posted higher levels of activity than the previous year.
The West suffered the largest decline in signed contracts, falling 12.0 percent from March, followed by the South where contract signings fell by 6.8 percent from the previous month while in the Midwest, signings fell by a modest 0.3 percent.
The Northeast was the only region to register a gain, improving 0.9 percent from March.
Compared to April 2011, the Midwest was 23.0 percent higher, the Northeast improved 19.9 percent and the South and the West saw activity improve by 13.3 and 5.1 percent, respectively.
“All of the major housing market indicators are expected to trend gradually up, but a new federal budget must be passed before the end of the year for the economy to continue to move forward,” Yun added.
NAR also adjusted its forecast on home sales and prices for 2012 with home sales expected to rise to 4.66 million this year and home prices projected to increase between two and three percent this year.
The PHSI is a forward looking indicator which generally indicates closings one to two months in the future.
Tags: pending home sales, existing home sales, contract signings, contract cancellations