pending home sales jump, end losing streak
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[April 29, 2014]
WASHINGTON (Reuters) — Contracts to buy
previously owned U.S. homes rose in March for the first time in nine
months, a sign the housing market could be stabilizing after
suffering a setback from a rise in interest rates and a severe
The National Association of Realtors said on Monday its Pending Home
Sales Index, based on contracts signed last month, increased 3.4
percent to 97.4. The increase beat economists' expectations for a
1.0 percent advance.
These contracts usually become sales after a month or two, and
March's rise suggested home resales could rebound in the months
Sales stumbled last summer after that the U.S. Federal Reserve
signaled it would soon reduce its economic stimulus efforts, pushing
interest rates higher. A harsh winter also helped keep potential
buyers out of the market.
"The stronger pending home sales report hints at resurgence in
housing market momentum during the typically busier spring buying
season," said Gennadiy Goldberg, a strategist at TD Securities.
Goldberg said the data suggested housing would continue to support
U.S. economic growth in the coming months.
The U.S. economy hit a slow patch over the winter, which was
particularly harsh in much of the country, but growth is expected to
rebound during the rest of 2014. The U.S. Labor Department is
expected to report on Friday the economy created 210,000 jobs in
Prices for U.S. stocks opened higher on Monday, while the yield on
30-year U.S. government bonds rose following the release of the
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Existing home sales had fallen to their lowest levels in more than
1-1/2 years, but details of Monday's report suggested the downward
trend in sales had probably run its course, with housing inventory
rising and more first-time buyers coming into the market.
Despite last month's surge, pending home sales were still down 7.9
percent compared to March of last year.
Contracts increased in the Northeast, in the South and in the West.
They fell in the Midwest.
(Reporting by Lucia Mutikani and Jason Lange;
editing by Paul Simao)
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