Share this article!

Pending home sales sank during April, according to new data from the National Association of Realtors (NAR).

The Pending Home Sales Index, NAR’s forward-looking indicator of home sales based on contract signings – tumbled by 6.3% to 71.3 in April from March. Year-over-year, pending transactions retracted by 2.5%. An index of 100 is equal to the level of contract activity in 2001.

All four regions recorded a month-over-month loss in transactions while year-over-year were only on the rise in the Midwest while loses were recorded in the Northeast, South and West.

“At this critical stage of the housing market, it is all about mortgage rates,” said NAR Chief Economist Lawrence Yun. “Despite an increase in housing inventory, we are not seeing higher home sales. Lower mortgage rates are essential to bring home buyers back into the housing market.”

“Home buyers have a better chance to purchase homes in affordable regions such as the Midwest, where the typical home price is $313,000 – 25% below the national median home price,” added Yun. “Moreover, with housing inventory levels reaching five-year highs, home buyers in nearly every region of the country are in a better position to negotiate more favorable terms.”