Pending home sales plunged nearly 11% in February

Home sales fell month-over-month for sixth consecutive month

National /
Mar.March 31, 2021 11:45 AM
(iStock)

(iStock/Illustration by Alexis Manrodt for The Real Deal)

Home prices are soaring, but low inventory continues to hamper home sales.

The pace of homes under contract fell 10.6 percent in February, marking the sixth straight monthly decline, according to the National Association of Realtors’ monthly index. February’s pending home sales were down 0.5 percent compared to a year ago, marking the first time in eight months that they fell year-over-year.

NAR’s index is seen as a leading indicator of existing home sales, and a major drop is typically seen as a drop in demand from homebuyers. But Lawrence Yun, NAR’s chief economist, attributed the index’s declines in February and January to the record low levels of housing on the market.

“The demand for a home purchase is widespread, multiple offers are prevalent, and days-on-market are swift, but contracts are not clicking due to record low inventory,” he said in a statement.

Yun said tight inventory was inhibiting activity predominantly among lower-priced homes, while higher-end properties — those priced above $1 million — continued to go into contract.

At the end of February, NAR reported that there were just over 1 million units on the market, a record low that was virtually unchanged compared to January’s inventory. Based on February’s pace of sales, that amounts to two months’ worth of supply.

The trend was regional, too, with every area NAR tracks reporting month-over-month declines in February. But contract activity in the southern and western regions remained elevated compared to February 2020, while the northeast and midwest regions followed the national trend of year-over-year declines.





    Related Articles

    arrow_forward_ios
    Steven Mnuchin and 740 Park Avenue (Getty, Google Maps)
    Steven Mnuchin’s $26M home finally finds a buyer
    Steven Mnuchin’s $26M home finally finds a buyer
    Robert Millard and 9 East 88th Street (MIT Corp, Google Maps)
    Former Lehman exec lists Carnegie Hill mansion for $38M
    Former Lehman exec lists Carnegie Hill mansion for $38M
    April’s occupancy levels climbed to 61.6 percent, above March’s 60.9 percent. (iStock)
    Demand for short-term rentals surges past pre-pandemic levels
    Demand for short-term rentals surges past pre-pandemic levels
    Cape Cod and the Jersey Shore suffered among the sharpest inventory declines. (iStock)
    Here’s where homes virtually sold out in the pandemic
    Here’s where homes virtually sold out in the pandemic
    Borrowers can now get a 30-year fixed-rate jumbo mortgage for $2 million at 2.65%. (iStock)
    Jumbo mortgage lenders invade Fannie and Freddie’s turf
    Jumbo mortgage lenders invade Fannie and Freddie’s turf
    1384 Meadow Lane
    The 20 priciest Hamptons sales this year
    The 20 priciest Hamptons sales this year
    Airbnb CEO Brian Chesky. (Airbnb, Getty)
    Airbnb’s losing spree continues with $1B loss in Q1
    Airbnb’s losing spree continues with $1B loss in Q1
    Madison Realty principal Josh Zegen, Raphael Toledano with the properties at 325-329 East 12th Street and 223-235 East 5th Street (Madison Realty, Google Maps, Toledano by Michael McWeeney)
    Madison Realty Capital closes on Toledano’s bankrupt East Village portfolio
    Madison Realty Capital closes on Toledano’s bankrupt East Village portfolio
    arrow_forward_ios

    The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

    Loading...