By Ian McKendry
WASHINGTON (MNI) – Pending home sales increased 2.1% in February to
a seasonally adjusted index level of 90.8, the National Association of
Realtors reported Monday.
On a seasonally adjusted year-over-year basis the index fell 8.2%.
“Month-to-month movements can be instructive, but in this uneven
recovery it’s important to look at the longer term performance,” NAR
Chief Economist Lawrence Yun said in a statement accompanying the
results.
Yun noted that the pending homes sales index, which measures
contracts signed and not actual closings, has been trending upward since
bottoming out in June 2010. Then, the index came in at 75.9.
“Contract activity is now 20% above the low point immediately
following expiration of the home buyer tax credit,” Yun said.
By region, the Northeast seasonally adjusted index fell 10.9% in
February, the Midwest index increased by 4.0%, the South saw an increase
of 2.7%, and pending home sales in the West were up 7.0%.
Yun said the Northeast index may have fallen because of bad weather
affecting shopping and contract activity.
The pending home sales index is a forward looking indicator because
closings usually occur one to two months after contracts are signed.
“We may not see notable gains in existing-home sales in the near
term, but they’re expected to rise 5% to 10% this year with the economic
recovery, job creation and excellent affordability conditions providing
confidence to buyers who’ve been on the sidelines,” Yun said.
** Market News International Washington Bureau: (202) 371-2121 **
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