A key index measuring pending home sales jumped 5.3 percent in March, compared to the previous month – and 21.1 percent above the March 2009 level.
As other indicators have shown, the homebuyer tax credits that expired April 30 helped rejuvenate sales activity in March after a lackluster beginning to the year, according to the data from the National Association of Realtors released today.
But NAR also reflects the thinking of other housing market analysts predicting a slowdown in the post-tax credit expiration time frame.
“Clearly the home buyer tax credit has helped stabilize the market. In the months immediately following the expiration of the tax credit, we expect measurably lower sales,” said Lawrence Yun, NAR chief economist. “Later in the second half of the year, and into 2011, home sales will likely become self-sustaining if the economy can add jobs at a respectable pace, and from a return of buyer demand as they see home values stabilizing.”
Yun said there has been another positive sign in the increasing availability of jumbo and second-home mortgages, which would lead to a re-opening of the market for those types of non-government backed mortgages.
The NAR index is based on a large national sample, representing about 20 percent of transactions of existing home sales. An index of 100 is equal to the average contract activity during 2001 – the first of five consecutive record years for existing-home sales.
The index rose to 102.9 in March from 97.7 the previous month. A year ago it was at 85.
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[...] Pending Homes Sales Index Up – Pending sales of previously owned US homes hit a five-month high in March. The increase was the result of homebuyers rushing to sign contracts before the tax credit expired. According to the National Association of Realtors, the pending home sales index rose a seasonally adjusted 5.3% in March, and was up 21.1% compared with a year earlier. [...]