A gauge of pending home sales declined in March as inventory continued to tighten.
The National Association of Realtors’ index fell 0.8% to a reading of 111.4, the group said Thursday.
Economists surveyed by Econoday had forecast a 0.5% decline.
The index forecasts future sales by tracking real estate transactions in which a contract has been signed, but the deal has not yet closed.
Activity was mixed regionally in March. Contract signings decreased 2.9% in the Northeast, 1.2% in the Midwest, and 2.9% in the West. They rose 1.2% in the South. Compared to a year ago, the indexes are higher in the Northeast and the South but lower in the Midwest and West.
Thanks to a strong first quarter, the Realtors forecast sales in 2017 to rise 3.5% compared to 2016. But supply isn’t keeping up with demand. There were 3.8 months of supply in March, and properties stayed on the market an average of only 34 days.
A balanced market is usually thought to have 6 months of supply.
Also read: Existing-home sales hit a 10-year high in March as homes fly off the market