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Date: Jun. 3, 2009
Tags: None
Today Bloomberg edition:
“The market is crawling back and maybe the turn is here,” said Ken Mayland, president of ClearView Economics LLC in Pepper Pike, Ohio, whose projected 4 percent gain was the highest in a Bloomberg survey. “Foreclosures are moving through the system and that is a fundamental part of the process of restoring equilibrium in the housing market.”
Pending resales are considered a leading indicator because they track contract signings. NAR’s existing-home sales report tallies closings, which typically occur a month or two later. The group, whose pending data goes back to January 2001, started publishing the index in March 2005.
Distressed Properties
Still, the gains in pending sales have been larger than actual home resales in recent months, perhaps reflecting the influence of foreclosures. Sales of distressed properties are taking longer to close because they require lender approval, Lawrence Yun, chief economist at the Realtors’ group, said in a statement. Moreover, some of these contracts fall through before a transaction is completed, he said.
“The market has already bottomed in some areas, but this is an unusual housing cycle with some areas improving rapidly while others languish or decline,” Yun said.
Builder shares rallied on signs the market is stabilizing. The Standard & Poor’s Homebuilder Supercomposite index closed up 2.8 percent at 221.35. The S&P 500 index climbed 0.2 percent to 944.74. The Treasury 10-year note rose, pushing the yield down to 3.61 percent at 4:17 p.m. in New York from 3.68 percent late yesterday
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