Pending Home Sales Surge almost 32% in 2009
Dec 2
Pending home sales increased 3.7% in October, rising for the 9th consecutive month and reaching the highest recorded level since March 2006. Up almost 32% from October 2008, pending home sales experienced the largest annual increase ever posted for NAR’s pending sales index.
Lawrence Yun, NAR’s chief economist, attributes the high numbers to the government’s home buyer tax credit, which has helped “unleash a pent-up demand from a large pool of financially qualified renters, much more than borrowing sales from the future.” Yun predicts that the extended credit could cause a lag in existing-home sales in December, but expects housing conditions to stabilize around the middle of 2010.
October presented positive movement in other sectors of the housing market, as well:
- Private residential construction spending surged 3.9%
- Housing inventory decreased to a 7-month supply, down from a 10.2-month supply in October 2008
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Existing home-sales rose 9.4 percent in September, reaching their highest level in almost two years and providing another indicator that the housing market remains on the road to recovery. Though home prices declined, economist Lawerence Yun predicts that the drop – a smaller dip than in previous months – reinforces hopes that home prices have begun to stabilize.