The National Association of Realtors’ leading indicator of future home sales hit a downdraft in April after three months of solid gains.
The Realtors reported Wednesday that its pending sales index fell 5.5% in April to its lowest level since December.
Despite this “one-month setback” during the spring selling season, NAR chief economist Lawrence Yun insists housing market conditions have fundamentally improved over the past12 months.
“Housing market activity has clearly broken out at notably higher levels and is on track to see the best performance since 2007,” Yun said.
NAR's pending sales index is based on signed contracts, which usually translates into actual sales in a month or two.
The PSI fell to 95.5 in April, down from 101.1 in March. It is the lowest reading since the index hit 95.1 in December. The PSI index is up over 14% from a year ago.
Last week, NAR reported that actual sales rose 3.4% in April to a seasonally adjusted annual rate of 4.62 million, up 10% from April 2011.
A new forecast shows existing home sales will increase 9.4% in 2012 to 4.66 million units, up from 4.26 million in the year prior.
Back in January, NAR was forecasting a 6.8% increase in existing home sales this year.
