2018.05.3110:27:00UTC+00U.S. Pending Home Sales Unexpectedly Slump 1.3% In April

Pending home sales in the U.S. unexpectedly showed a sharp decrease in the month of April, according to a report released by the National Association of Realtors on Thursday.

NAR said its pending home sales index tumbled by 1.3 percent to 106.4 in April after rising by 0.6 percent to 107.2 in March. Economists had expected pending home sales to increase by 0.4 percent.

A pending home sale is one in which a contract was signed but not yet closed. Normally, it takes four to six weeks to close a contracted sale.

"Pending sales slipped in April and continued to stay within the same narrow range with little signs of breaking out," said NAR chief economist Lawrence Yun.

He added, "The unfortunate reality for many home shoppers is that reaching the market will remain challenging if supply stays at these dire levels."

The unexpected decrease in pending home sales was partly due to a steep drop in the Midwest, where pending sales plunged by 3.2 percent.

Pending home sales in the South also slumped by 1.0 percent, while pending sales in the West dipped by 0.4 percent and pending sales in the Northeast were unchanged.

Yun still forecasts for existing home sales to increase 0.5 percent to 5.54 million in 2018, up from 5.51 million in 2017. The national median existing-home price is expected to increase around 5.1 percent.