Latest housing market blow: Pending home sales gauge plunges
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Pending home sales fell to the lowest level in four years in April — the worst reading since the height of the pandemic lockdown.
Why it matters: Spring homebuying season is looking like a serious slump — it's the second-lowest reading since the National Association of Realtors started tracking the data in 2001.
The big picture: Would-be buyers are turned off by high mortgage rates and record home prices.
- And it's not just demand: Buyers willing to jump into the market face lackluster supply — existing homeowners don't want to give up low mortgage rates.
By the numbers: An index that tracks existing homes under contract fell nearly 8% last month, according to the NAR.
- No region was spared, though the Midwest index saw the biggest monthly decline of 9.5% in April.
- Mortgage rates topped 7% this week, up from 6.8% in early April, Freddie Mac said on Thursday.
What they're saying: "Home prices are hitting record highs, but the pace of gains should decelerate with more supply," Lawrence Yun, the trade group's chief economist, said in a statement.
- Yun added that interest rate cuts could "improved affordability and more supply," though it's unclear when the Fed will pivot.
