Pending home sales rose 6.1% in May from the month before,
the highest increase since April 2010
Pending home sales surged more than expected in May, the
latest sign a sluggish housing recovery is picking up steam
.
Signed contracts for previously owned homes jumped 6.1% from
April, the National Assn. of Realtors said Monday. It was the largest pop since
April 2010. Then, families rushed to lock in a first-time home buyer tax credit
before it expired.
After slowing last summer, the housing market appears to be
turning a corner. More homes on the market, slowing price appreciation and
lower mortgage rates have lured buyers off the sidelines, economists say.
May's pending sales data beat expectations.The median
forecast for economists polled by Bloomberg News was for a 1.5% rise.
And buyers closed deals on 4.9% more previously owned homes
in May than April. Meanwhile, new home sales jumped 18.6% in May.
“An improvement in sales is likely to continue for a least a
few more months, a welcomed reprieve after a significantly slow start to the
year,” Sterne Agee chief economist Lindsey Piegza said in a statement.
Still, the market isn’t humming like last year. Higher
prices and fewer foreclosures have investors and families less likely to strike
a deal. Pending sales last month were 5.2% below May 2013 levels.
The Realtors pending sales index, adjusted for seasonal
swings, tracks signed, but not closed contracts for previously owned homes.
Deals usually close within one or two months
.
Pending sales rose in all regions from April. In the West,
they climbed 7.6%
.
Further gains, Piegza said, will rely on “sustained
improvement in income and job creation.”
