May 4, 2009

Pending home sales rose in March

Pending U.S. home sales rose 3.2 percent in March as buyers found improved market conditions, the National Association of Realtors in Washington said Monday.

The Pending Home Sales Index, based on contracts signed in the month, rose from 82 to 84.5, NAR said.

This increase could be the leading edge of first-time buyers responding to very favorable affordability conditions, NAR Chief Economist Lawrence Yun said in a statement.

However, we need several months of sustained growth to demonstrate a recovery in housing, which is necessary for the overall economy to turn around, Yun said.

In March, the pending sales index increased the most in the South, rising 8.5 percent. In the West, the index rose 3.9 percent. It fell in the Northeast and Midwest, however, dipping 5.7 percent and 1 percent, respectively.

Affordability has increased, NAR President Charles McMillan said.

Compared to a year ago, the typical family can pay much less in mortgage costs for the same home or buy a better home without necessarily increasing their monthly payment, he said.

In March, the median sales price for a single-family home was $174,900, the report said.