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First Cut: NAR Pending Home Sales Index rose sharply in March, highest since July 2018

The NAR’s Pending Home Sales Index for March blew past market expectations to rise 3.8% to 105.8 in March from 101.9 in February. It was the highest since 105.9 in July 2018 at a time when the housing market started to soften in the face of rising mortgage interest rates. The reading was down 1.2% from the year-ago month. However, the March bounce was a good sign that the spring buying season will be a strong one and that consumers are motivated by present lower mortgage rates to enter the market and lock in a favorable rate.

Three of four regions had gains in March. The indexes for the West (up 8.7%), South (up 4.4%), and Midwest (up 2.3%) reflected renewed demand for homeownership, or at least for snapping up homes while affordability is better. The Northeast (-1.7%) wasn’t much changed from the prior months where homebuying has been relatively steady in recent months and where demand may have been somewhat depleted.

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