Stay-at-home orders, curtailed real estate activities and an economic shutdown sent pending home sales into the dumps in April, according to a new report released Thursday by the National Association of Realtors.
The Pending Home Sales Index dropped 21.8 percent from March – and was 33.8 percent lower than April 2019, the largest decline since NAR began tracking pending sales in 2001. Every major region experienced a drop in month-over-month contract activity and a decline in year-over-year pending home sales.
“With nearly all states under stay-at-home orders in April, it is no surprise to see the markedly reduced activity in signing contracts for home purchases,” said Lawrence Yun, NAR’s chief economist.
Here is how each region fared:
- The Northeast dropped 48.2 percent from March and was 52.6 percent lower than a year ago.
- The Midwest dropped 15.9 percent from March and 26 percent lower than April 2019.
- The South dropped 15.4 percent in April and 29.6 percent from last year.
- The West dropped 20 percent for the month and 37.2 percent from a year ago.
Yun said expects that April will be the lowest point for pending contracts, and the month of May will be the lowest point for closed sales.
“While coronavirus mitigation efforts have disrupted contract signings, the real estate industry is hot in affordable price points with the wide prevalence of bidding wars for the limited inventory,” he said. “In the coming months, buying activity will rise as states reopen and more consumers feel comfortable about homebuying in the midst of the social distancing measures.”