April home sales hit 6-month high

US pending home sales hit a six-month high in April but falling demand for home loans pointed to ebbing activity in the housing market with the expiration of a popular tax credit for buyers.

The National Association of Realtors said its Pending Home Sales Index, based on contracts signed in April, rose 6 percent to 110.9, the highest level since October and above expectations of a 5 percent gain.

But applications for loans to buy homes dropped for the fourth straight week, holding 13-year lows, the Mortgage Bankers Association said.

“It’s partly attributable to the last-minute rush to take advantage of the homebuyer’s tax credit,” said David Resler, chief US economist at Nomura Securities. “The next month or two, we might get some payback as the homebuyers who were induced to buy early are no longer in the market.”