MarketMinute | Why Did Home Sales & Pending Home Sales Fall?
Consumer confidence hovered at a 14-month high in May, as optimism over jobs tempered concerns about rising inflation and diminishing government financial stimulus. |
Durable goods orders fell in April, the first time in a year. However, the decline was mainly due to a drop in the automotive sector, where an ongoing microchip shortage is an issue. |
The labor market continues to show signs of rebounding. Last week's initial jobless claims dropped more than expected to 406,000, a new pandemic low. |
Existing home sales fell for the third straight month in April. Demand remained strong, but sales were constrained by inventory, which was down 20%. |
Pending home sales also fell in April. Elevated asking prices, reflecting the limited supply of homes on the market, are making properties less affordable and curbing sales. |
Home price appreciation is accelerating as buyers continue to fight for limited inventory. Case-Shiller showed a year-on-year gain of 13.3% in March, up from 12% in February. |