Pending home sales retrenched in April following three consecutive monthly gains, but are notably higher than a year ago, according to the National Association of Realtors.
The Pending Home Sales Index, a forward-looking indicator based on contract signings, declined 5.5 percent to 95.5 from a downwardly revised 101.1 in March but is 14.4 percent above April 2011 when it was 83.5. The data reflects contracts but not closings.
Lawrence Yun, NAR chief economist, said a one-month setback in light of many months of gains does not change the fundamentally improving housing market conditions. “Home contract activity has been above year-ago levels now for 12 consecutive months,” he said. “The housing recovery momentum continues.”
Yun notes that home sales are staying well above the levels seen from 2008 through 2011.
In the western U.S., including homes in Colorado and Denver real estate, the index dropped 12.0 percent in April to 94.9 but is 5.1 percent above a year ago. The housing forecast has been upgraded, with existing-home sales expected to reach 4.66 million this year, compared with 4.26 million, but could vary significantly depending on two scenarios:
If lending returns to normal, the 2013 outlook for existing-home sales would measurably improve to 5.3 million. However a fiscal cliff scenario of higher taxes and sharp spending cuts beginning in early 2013, which is an unlikely event but still worth noting, would lower the sales projection to 4.5 million.