More Good News From US Housing Market
NEW YORK (BankingMyWay) -- The positive news just keeps coming in from the U.S. housing market, with data from the National Association of Realtors showing that pending home sales were up 5.9% in May.
That's the highest pending home sales level since 2010, and the upside is being felt in every U.S. region.
This time, it looks like the rise in home sales contracts signed is a natural one, too. In March 2010, the last time home contracts were this high, homebuyers were rushing to sign new home deals before the first time homebuyer tax credit expired.
The pending home sales data follows last week's news that California home sales -- the biggest market in the U.S. -- are up, and that new home sales, as measured by the U.S. Commerce Dept., are rising, too.The NAR's Pending Home Sales Index is 13.3% higher than a year ago. "The housing market is clearly superior this year compared with the past four years," noted Lawrence Yun, the NAR's chief economist in a statement. "The latest increase in home contract signings marks 13 consecutive months of year-over-year gains. Actual closings for existing-home sales have been notably higher since the beginning of the year and we're on track to see a 9 to 10 percent improvement in total sales for 2012." The NAR predicts that the bump in home sales should be sustainable. The organization estimates that U.S. median home sales should rise by 3% in 2012, and by 5.3% in 2013. In the Northeast, the growth rate in May was 4.8%; in the Midwest it was 6.3%; in the South, 1.1%; and in the West, 14.5%. On a year-to-year basis, the U.S. Northeast showed the strong home sales growth rate, up 19.8% from May 2011 to May 2012. The Midwest showed solid growth, too, at 22.1%. The Western states owed the weakest growth rate, at 4.8%. All of those growth rates may continue to move up, if -- and it's a big if - banks and lenders grant more home loans, which would reduce the number of "for sale" signs on front lawns across the U.S. "If credit conditions returned to normal and if we had more inventory, especially in the lower price ranges, more people would become successful buyers," Yun adds. "In an environment of historically favorable housing affordability conditions, it's frustrating to see some consumers thwarted in the process." It's also going to take some time before underwater homeowners swallow a bitter pill and put their homes on the market, a scenario that Yun says is a "when" and not "if" situation. Indeed, while Europe teeters on the brink and global macroeconomic concerns remain a trigger point for stock market panic, all the domestic housing market trends are pointing to a continued recovery in 2013. It's been a long time since the U.S. housing market was the brightest spot in the global economy. --By Brian O'Connell Follow TheStreet on Twitter and become a fan on Facebook.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
24/7 market commentary from Jim Cramer and 20+ veteran Wall Street gurus. Get access to the latest trading ideas on stocks, options, and ETFs as well as a real-time forum to see the pros exchanging their investment ideas.
- Jim Cramer + 20 Wall Street pros
- Intraday commentary & news
- Real-time trading forum
- Actionable trade ideas
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV