U.S. Pending Home Sales Rise to Highest in 2.5 Years

U.S. pending home sales rise to highest in 2.5 yearsBy CHRISTOPHER S. RUGABER, AP Economics Writer

WASHINGTON (AP) - A measure of Americans who signed contracts to buy homes increased last month to its highest level in two and a half years, the latest sign of improvement in the once-battered housing market.

The National Association of Realtors said Friday that its seasonally adjusted pending home sales index rose 1.7 percent in November from October to 106.4. That's the highest since April 2010, when a homebuyer tax credit caused a spike in sales. And after excluding those months when the tax credit was available, it's the best reading since February 2007.

The increase points to higher sales of previously occupied homes in the coming months. There's generally a one- to two-month lag between a signed contract and a completed sale.

Signed contracts to buy homes rose in the Northeast and West, and ticked up slightly in the Midwest. They were unchanged in the South.

Home sales are on track to rise 10 percent this year to their highest level in five years, buoyed by ultra-low mortgage rates and steady job gains.

The housing recovery that began earlier this year is looking sustainable for a number of reasons. The supply of previously occupied homes for sale has finally thinned out and is at an 11-year low. At the same time, more people are looking to buy or rent a home after living with relatives or friends during and in the aftermath of the Great Recession.

The combination of stronger demand and limited supply is pushing up home prices. That could encourage more sellers to put their homes on the market because they can expect a better price.

Builders are also more optimistic that the recovery will endure and are stepping up construction. The pace of home construction was nearly 22 percent higher in November compared with a year earlier. Builders are on track this year to start work on the most homes in four years.

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lloeks

Balony. How many months in a row has the unemployment report come out and then been 'adjusted' soon after?
Banks have been holding back forclosed inventory and even demolishing houses that have become unlivable. The next wave of foreclosures will be even worse than the last. Thanks to events like Sandy there undoubtably is some localized work as there was post Katrina. Military spending is a huge portion and 600% more than any other sector. Lots of money in the sector that builds drones and employment for people who are willing to blow up families in the Middle East, right. Did the Koch Brothers buy AOL? Oh, I see ~ it's an associated press article. Corporate owned source intended to manipulate the masses. Who believes this blather? I guess the Ass Press is laughing all the way to the bank that just kicked 5 Million families to the curb.

December 28 2012 at 11:12 PM Report abuse -3 rate up rate down Reply
Mike

I wonder how much of this is people trying to get their purchase in before the fiscal cliff avalanches on them or more likely "flippers" who are buying low and hoping that the market will allow them to make a profit later.

December 28 2012 at 4:05 PM Report abuse +6 rate up rate down Reply
1 reply to Mike's comment
davefromfwb1

Actually mike....from what I've noticed is that people are actually getting loans finally. The banks are starting to lend money for the first time in 5 years. Down here in Florida I've noticed lots of developers and a few individual civilians are starting to buy lots of houses down here. The properties are so cheap and the interest rates are so low....with everyone filing bankruptcy...individuals aren't able to rent apartments so their own choice is homes where the landlord will overlook their financial pasts. Owning a rental house now is like sitting on a pot of gold...within the next 10 years it'll double what it is now...that's including rental income along with equity of the property. I'm saving up to buy rental property because thats where the money will be.

December 28 2012 at 6:24 PM Report abuse +2 rate up rate down Reply
cgino

Home sales are on track to rise 10 percent this year to their highest level in five years, buoyed by ultra-low mortgage rates and steady job gains.--------------------------------------------------------------------------------------------------
What a load of crap! Steady job gains? What planet are they on? The unemployment rate has only "officially" been lowered as a result of people falling off the unemployment rolls. These people didn't get high paying jobs, they are unemployed! Anyone that believes this fairy tale is really dumb or drinking the koolaide! After the higher taxes and Obamacare go into effect, between 700,000 and 1.3 million will lose their jobs, mostly highly paid gov. contractor jobs! Go out and buy that 400K home and within six months, it will depreciate. Now is the time to purge real estate instead of buying it!

December 28 2012 at 3:57 PM Report abuse -3 rate up rate down Reply
progressivehoax

Barney Frank and company, destroying America one forclosure at a time.

December 28 2012 at 3:31 PM Report abuse -4 rate up rate down Reply
mik222e

The biggest obstacle to buying is extremely strict qualifying standards for loans.

December 28 2012 at 3:29 PM Report abuse rate up rate down Reply
1 reply to mik222e's comment
vlady1000

if you are loan worthy (like it used to be many years ago), they are not all that different than before. They just have eliminated most of the ones that should not be getting a loan to start with.

December 28 2012 at 5:29 PM Report abuse +6 rate up rate down Reply
1 reply to vlady1000's comment
davefromfwb1

You're correct vlady----it's gotten alot easier to get a loan than it was 1-2 years ago. I tried to get a loan 3 years ago and NOBODY would talk to me because I'm self employed. Now, because I own my own home for last 15 years, I can get any loan I want at a super low interest rate. The problem we're having today is, there isn't enough qualifing people to get loans due to bad credit scores, not enough job history or lack of equity in their homes. Fortunately for me I bought 15 years ago and am saving to buy within the next year or so another rental property.

December 28 2012 at 6:29 PM Report abuse +4 rate up rate down
Charles

It would be interesting to know who is buying the homes. In our area , buyers are mostly speculators looking to buy at the bottom of the market and to eventually make a profit. I will believe it when I see constrution of new homes being built for anxious homebuyers, with money in their pockets and a good job!!

December 28 2012 at 2:11 PM Report abuse +2 rate up rate down Reply
1 reply to Charles's comment
vlady1000

Investors have been a big part. With rents up and costs down (lower rates), that is the best of both worlds to a business person. They have never cashflowed better. With 25% down, you can get up to 25% return on your money from just the positive cashflow in some places, and the tenants are still buying the place for you. So if you include the princple reduction they are paying, it is 31% return, and that is if they do not appreciate at all. And this is for the next 30 years, and is pretty much inflation protected (or better) too as the rents go up.

December 28 2012 at 5:35 PM Report abuse +4 rate up rate down Reply
Jetncat

Now for that bridge I like to sell you.

December 28 2012 at 12:30 PM Report abuse -7 rate up rate down Reply
rraahh1

Yea,and the country is better off than during the "Great Depression",so what lets raise the bar and compare ourselves to times that were good.

December 28 2012 at 11:59 AM Report abuse -3 rate up rate down Reply
mrspelosi

Baloney

December 28 2012 at 11:27 AM Report abuse -8 rate up rate down Reply