Realtors: '08 Sales to Improve, but Slump Isn't Over
The National Association of Realtors announced yesterday that existing-home sales are projected to show a slight increase in 2008, though many measures still indicate that housing is likely to remain weak for some time.
Existing-home sales are likely to total 5.67 million this year, falling 12.5% from the 6.48 million total in 2006. But the NAR now projects that sales will rise to 5.70 million in 2008, a slightly more optimistic forecast than it gave in November.
Pending home sales are well off year-ago levels but are inching upward on a monthly basis, according to recently released data based on October numbers. The Pending Home Sales Index, a forward-looking indicator based on contracts, increased in October to 87.2 from an upwardly revised reading of 86.7 in September. It was the second consecutive monthly gain, but it remained 18.4% below the October 2006 index of 106.8.
"The broad trend over the coming year will be a gradual rise in existing-home sales," said NAR Chief Economist Lawrence Yun in a press statement.But others were less optimistic. "We are not out of the woods yet. You are going to have to see three or four months of a pickup in activity to know it is getting better," says Alan Rosenbaum, CEO-founder of New York-based GuardHill Financial Corp, a high-end mortgage brokerage, who adds, "I am surprised by these numbers [from the NAR] but this doesn't signal a rebound in real estate right now." The PHSI in the Northeast jumped 16% in October to 80.6 but is 11.1% below a year ago. In the West, the index rose 8.4% to 87.3 but is 16.9% lower than October 2006. The index in the Midwest slipped 1.4% in October to 85.5 and is 11.7% below a year ago. In the South, the index dropped 7.8% in October to 91.6 and is 25.3% below October 2006.
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