Existing home sales surge unexpected 3.9%

WASHINGTON – Sales of previously owned homes surged 3.9 percent in February to a seasonally adjusted rate of 6.69 million per year from January’s rate of 6.44 million, according to a report today from the National Association of Realtors.

The rate was 3.6 percent lower than in February 2006, and median price of $212,800 was 1.3 percent lower than a year ago.

But the monthly gain, the biggest in nearly three years, was widely seen as a sign the housing market is recovering even as the lending market slumps, according to Bloomberg News. Analysts surveyed by Bloomberg had expected resales to drop 2.5 percent to 6.3 million per year from January’s originally reported 6.46 million.

The supply of homes on the market at the end of the month rose 5.9 percent to 3.748 million – a 6.7-month supply at the current pace, compared with the market’s 6.6-month supply at the end of January.

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Single-family existing home sales rose 3.7 percent to a rate of 5.88 million per year, while condominium sales rose 5.3 percent to 810,000 per year.

The Northeast showed the greatest increase in the sales rate – 14.2 percent – followed by sales gains of 3.9 percent in the Midwest and 1.6 percent in the South. Sales in the West were unchanged, the NAR said.

“Most of the housing adjustment is completed,” Eric Green, chief market economist at Countrywide Securities in Calabasas, Calif., told Bloomberg. “We’re just not seeing the subprime problem in these numbers yet.”

Additional information is available at www.realtor.org.

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