The National Association of Realtors' gauge of future home sales drifted lower in June after a 30% plunge in May just after the federal tax credit expired for first-time and move up buyers.

NAR's pending sales index fell only 2.6% in June to 75.7, but compared to the same month a year ago is down 18.6%.

The seasonally adjusted index is based on newly signed sales contracts on existing homes that should go to closing in a month or two.

The Realtors' chief economist Lawrence Yun expects to see a few more months of slow home sales activity before a pickup in the fourth quarter.

NAR is forecasting a 19% drop in existing home sales in the third quarter from the second quarter, before a 16% rebound in the fourth quarter.

That rebound would push sales to a 5.27 million seasonally adjusted annual rate in the fourth quarter, up from a 4.55 million rate in third quarter, according to the NAR forecast.

But that pickup in sales will need help from the job market. Longer term, "we really need to see stronger job creation to have a meaningful recovery in the housing markets," Yun said.

In related news, home builder D.R. Horton Inc. swung to a fiscal third-quarter profit as buyers rushed to tap the federal home-buyer tax credit boosted revenue. But, as with most builders nationwide, orders declined after the credit expired in late April.

"Market conditions in the home building industry have become more challenging," company chairman Donald R. Horton said. "Orders declined significantly in May and improved modestly in June and July."

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