Pending home sales declined 2.7% in May from April, but not due to lack of demand, according to the National Association of Realtors. Rather, a lack of available homes for sale fueled a drop in contract signings.
“Despite sluggish pending contract signings, the housing market is resilient with approximately three offers for each listing,” NAR Chief Economist Lawrence Yun said in a statement. “The lack of housing inventory continues to prevent housing demand from being fully realized.”
Compared with May 2022, pending home sales fell 22.2% to an index level of 76.5.
“It is encouraging that homebuilders have ramped up production, but the supply from new construction takes time and remains insufficient,” Yun added. “There should be more focus on boosting existing-home inventory with temporary tax incentive measures.”
Regionally, compared with April, pending home sales grew 12.9% in the Northeast and fell 5.3% in the Midwest, 4.4% in the South and 6.1% in the West.
The full NAR report can be found here.
