Pending sales up Feb. through May

WASHINGTON – Pending home sales rose each month from February through May, the National Association of Realtors reported early this month.
NAR’s Pending Home Sales Index, an indicator of future existing-home sales based on contracts signed, rose 0.1 percent in May to 90.7. That’s 6.7 percent higher than 85.0 the index registered in May 2008.
The boost is the result of “very favorable housing affordability” and the federal first-time homebuyer tax credit, according to NAR.
“Closed existing-home sales have improved but are coming in lower than expected because some contracts are delayed or falling through from the application of new appraisal rules for many transactions,” NAR Chief Economist Lawrence Yun said in a statement. “Rises in contract activity show buyers are becoming more active even as they face much more stringent loan underwriting standards.”
He added, “Speedy clarification of the appraisal rules could smooth a housing market recovery and support the overall economy.”
The last time the index rose for four consecutive months was in late 2004, NAR reported.
The National Association of Realtors is the nation’s largest trade association, with more than 1.3 million members in all aspects of residential and commercial real estate. Additional information is available at www.realtor.org.