GOOD NEWS!
Pending home sales rise 6.7 percent in April
Fresh from the press: The number of U.S. homebuyers who agreed to purchase a previously occupied home in April posted the largest monthly jump in nearly eight years, a sign that sales are finally coming to life after a long and painful slump.
The National Association of Realtors said its seasonally adjusted index of sales contracts signed in April surged 6.7 percent to 90.3, far exceeding analysts' forecasts. It was the biggest monthly jump since October 2001, when pending sales rose 9.2 percent.
Economists were encouraged by the report, and stock indexes advanced modestly.
And analysts cautioned prices will take longer to stabilize, because of the glut of unsold properties on the market.
The Realtors' index was 3.2 percent above last year's levels and has risen for three straight months after hitting a record low in January. A nearly 33 percent sales increase in the Northeast and a 9.8 percent jump in the Midwest led the overall surge. Sales contracts rose 1.8 percent in April from a month earlier in the West, but fell 0.2 percent in the South.
The big boost likely reflects the impact of a new $8,000 tax credit for first-time homebuyers that was included in the economic stimulus bill signed by President Barack Obama in February. Since buyers need to finish their purchases by Nov. 30 to claim the credit, "we expect greater activity in the months ahead," Lawrence Yun, the Realtors' chief economist, said in a statement.
Still, Yun cautioned that the pending sales data is more volatile than in the past because many sellers need banks to agree to take less than the original mortgage - a so-called "short sale." That process is often difficult, time-consuming and can wind up falling apart before the deal closes.
Completed home sales rose 2.9 percent to an annual rate of 4.68 million in April from a downwardly revised pace of 4.55 million in March, the Realtors' group said last week.
Sales of inexpensive foreclosures and other distressed low-end properties have even sparked bidding wars in places like Las Vegas, Phoenix and Miami.
