Pending home sales rose 1.5 percent month over month in March but remained 1.1 percent below year-ago levels, according to the National Association of Realtors’ monthly Pending Home Sales report.
Contract signings increased in the Northeast and South month over month while declining in the Midwest and West. Year over year, only the South posted gains.
“Contract signings rose in March despite higher mortgage rates, pointing to pent-up housing demand,” NAR Chief Economist Lawrence Yun said. “A greater supply of inventory will help translate that demand into more home sales.”
The South led regional performance with a 3.9 percent monthly gain and a 2.3 percent annual increase. The Northeast rose 4.4 percent month over month but fell 6.5 percent from a year ago. The Midwest slipped 1.3 percent from February and 3.1 percent year over year, while the West dropped 2.6 percent monthly and 1.7 percent annually.
Among the 50 largest metro areas, Kansas City, Missouri, led annual gains at 14.9 percent, followed by Milwaukee-Waukesha at 13.5 percent and Austin-Round Rock-San Marcos, Texas, at 12.8 percent, according to Realtor.com Economics data. Phoenix; Raleigh, North Carolina; Portland, Oregon; Richmond and Virginia Beach, Virginia; Dallas-Fort Worth; and Washington, D.C., also posted year-over-year increases.
Yun attributed the South’s outperformance to a combination of price cuts and job growth over the past year. He said affordable new construction should be a priority, given first-time and younger buyers’ sensitivity to mortgage rates.
NAR’s Pending Home Sales Index tracks signed contracts on existing homes and serves as a leading indicator for closed sales, which are typically finalized one to two months later.
