By Ovunc Kutlu
ISTANBUL (AA) - US pending home sales plummeted 7.7% in April, diving to their lowest level in four years, according to data released Thursday by the National Association of Realtors (NAR).
While the market expectation of for the figure was to show a 1.1% decline, pending home sales fell to their lowest since April 2020.
The pending home sales index, which is a forward-looking indicator of home sales based on contract signings, declined to 72.3 in April, from 78.3 in March.
"The impact of escalating interest rates throughout April dampened home buying, even with more inventory in the market," said Lawrence Yun, the association’s chief economist. "But the Federal Reserve's anticipated rate cut later this year should lead to better conditions, with improved affordability and more supply."
On an annual basis, pending transactions were down 7.4%, compared to the same month of the last year.
Pending home sales declined in all US regions both on monthly and annual bases, the NAR said in its statement.
"Home prices are hitting record highs, but the pace of gains should decelerate with more supply," said Yun. "The few markets experiencing price declines will be viewed as second-chance opportunities for buyers to enter the market if those regions continue to add jobs."
Pending home sales measure the change in the number of houses under contract to be sold but still awaiting transaction. It excludes new home construction.