Sales of existing homes probably climbed in April to the highest level in more than three years, giving a lift to the U.S. expansion, economists said before a report today.
Purchases of previously owned residences rose to a 4.99 million annualized rate last month, the highest since November 2009, from 4.92 million in March, according to the median forecast of 78 economists surveyed by Bloomberg.
Housing has gained strength as borrowing costs near record lows and job gains rebuild confidence, spur demand and stabilize prices. The effects are rippling through the world’s largest economy, affecting builders including Ryland Group Inc., retailers such as Home Depot Inc. (HD), and mortgage lenders.
“The market is definitely a lot healthier than it has been for some time,” said Richard Moody, chief economist at Regions Financial Corp. in Birmingham, Alabama. “Other parts of the economy aren’t holding up their part of the bargain, but housing is holding up its end.”
Federal Reserve Chairman Ben S. Bernanke, who is to testify before Congress today on the economic outlook, will be able to point to the real estate rebound as a policy success even as manufacturing and other sectors cool. The central bank is boosting home sales and holding down interest rates with $40 billion a month in mortgage bond purchases.
The National Association of Realtors’ home-sales report is due at 10 a.m. Washington time. Economists’ projections in the Bloomberg survey ranged from 4.85 million to 5.1 million.
The projected pace of April sales would be the fastest since a homebuyer tax credit was first due to expire in November 2009. It would be the third-highest since July 2007.