Increase in pending home sales reflects improving market
WASHINGTON (AP) -- A measure of the number of Americans who signed contracts to buy homes rose in January from December to the highest level in more than 2.5 years. The increase suggests sales of previously occupied homes will continue rising in the coming months.
The National Association of Realtors said Wednesday that its seasonally adjusted index for pending home sales rose 4.5 percent last month to 105.9. That's the highest since April 2010, when a homebuyer's tax credit was about to expire.
There is generally a one- to two-month lag between a signed contract and a completed sale.
Pending home sales rose in all regions, but just barely ticked up in the West, where a limited supply of available homes is holding back sales.
The increase is the latest positive report for the housing market, which began recovering last year after a deep, six-year slump. Steady hiring and nearly record-low mortgage rates have encouraged more Americans to buy homes. More people are also moving out on their own after living with friends and relatives in the recession. That's driving a big gain in apartment construction and also pushing up rents.
"Housing market activity appears to have ended 2012 on a positive note and is off to a strong start in 2013," Cooper Howes, U.S. economist at Barclays Capital, said in a note to clients.
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