Housing News

Homebuyers Are Purchasing More Homes This Spring

More homes have gone under contract this spring, despite rising mortgage interest rates.

Pending home sales increased 1.4% in April compared to March, according to the latest National Association of Realtors (NAR) data. The number of homes under contract was up 3.2% in April year-over-year.

(Pending home sales are homes that are under contract that haven’t closed yet. The NAR data only includes existing homes and excludes new construction.)

“Buyers are coming out with cautious optimism despite increasing economic uncertainty and a slight rise in mortgage rates,” said NAR Chief Economist Lawrence Yun in a statement. “Demand will easily be even higher once mortgage rates retreat to the levels they were at earlier this year.”

Mortgage rates averaged 6.36% for 30-year, fixed-rate loans in the week ending May 14, according to Freddie Mac.

The Northeast was the only region of the country where pending home sales decreased in March annually. They went down 0.6% year-over-year.

Pending sales rose the most annually in the South, where they were up 4.7%. That was followed by the West, where they rose 3.8%, and the Midwest, where they ticked up 2.7%.

The Boston metro area posted the largest increase in homes going under contract in April compared to a year ago in the 50 largest metropolitan areas. Pending sales were up 10.3% year-over-year.

(Metros include the main city and surrounding towns, suburbs, and smaller urban areas.)

It was followed by Miami, where pending sales rose 9.4%; Oklahoma City, up 8.6%; Milwaukee, up 7.4%; and Virginia Beach, VA, up 7.2%.

“The increase in pending home sales suggests the U.S. housing market is stabilizing after a slow start to the year,” said First American Senior Economist Sam Williamson in a statement.