The National Association of Realtors (NAR) reported on Thursday that pending home sales in the United States fell by 5.4% in June. The pending home sales index declined to a reading of 72.5, a larger drop than the 0.5% decrease previously forecast by economists polled by Reuters. On a year-over-year basis, contract signings slipped by 0.3%.
Contract activity declined across all four major U.S. regions during the month. The NAR attributed the slowdown to a combination of high mortgage rates and record-high median home prices, which have created affordability challenges for prospective buyers.
Lawrence Yun, the NAR’s chief economist, stated that the current market conditions are particularly difficult for first-time homebuyers due to the elevated costs. The report also noted that mortgage rates may remain high following an increase in geopolitical tensions between the United States and Iran earlier in the month.