From the WSJ:
The housing market showed signs of improvement as the number of Americans signing contracts to buy existing homes increased in November to the highest level in 19 months.
The National Association of Realtors’ seasonally adjusted index for pending sales of existing homes increased 7.3% on a monthly basis to 100.1, the industry group said Thursday. Sales increased in all four regions of the country.
Economists surveyed by Dow Jones Newswires had expected pending-home sales would climb by 0.5% in November. November’s 100.1 level was the highest since April 2010.
The NAR credited the increase partly to pent-up demand from buyers who have been on the sidelines for months and may have previously failed to obtain a mortgage.
“Some of the increase in pending home sales appears to be from buyers recommitting after an initial contract ran into problems, often with the mortgage,” the trade group’s chief economist, Lawrence Yun, said in a statement.
The NAR’s pending sales gauge is 5.9% above its level in November 2010.
The number of Americans signing contracts to buy previously owned homes rose more than forecast in November as falling prices and low borrowing costs boosted demand.
The index of pending home sales increased 7.3 percent to the highest level since April 2010 after climbing 10.4 percent the prior month, figures from the National Association of Realtors showed today in Washington. Economists forecast a 1.5 percent gain, according to the median estimate in a Bloomberg News survey.
The industry that triggered the 18-month recession that ended in June 2009 is showing signs of stabilizing as construction picks up, builder confidence improves and the number of houses on the market declines. Nonetheless, another wave of foreclosures may weigh on real-estate values next year.
“It looks like buyers are becoming more confident and are attracted to record-low mortgage rates,” Aaron Smith, a senior economist at Moody’s Analytics Inc. in West Chester, Pennsylvania, said before the report. At the same time, he said, “activity still looks depressed by historical standards.”
Estimates for pending home sales ranged from a drop of 3 percent to an increase of 11 percent, according to the median of 30 forecasts in the Bloomberg survey.
Pending home sales were up 6.9 percent from November 2010. (this is 5.9, not 6.9 – jb)
Pending home sales — a measure of mortgage contracts signed and an indicator of possible home closings – increased 7.3% in November from October, reaching its highest level in 19 months, the National Association of Realtors said Thursday.
The trade group’s pending home sales index hit 100.1 in November, up from a revised 93.3 for October and 5.9% higher than 94.5 a year earlier.
The last time the index score topped 100 was April 2010 when it hit 111.5, which was buoyed by the effects of the federal homebuyer tax credit.
Lawrence Yun, NAR chief economist, said November’s gain is likely due to delayed transactions that stalled over mortgage contracting issues.
“Housing affordability conditions are at a record high and there is a pent-up demand from buyers who’ve been on the sidelines, but contract failures have been running unusually high,” Yun said. “Some of the increase in pending home sales appears to be from buyers recommitting after an initial contract ran into problems, often with the mortgage.”