By Denny Gulino and Ian McKendry
WASHINGTON (MNI) - April's improvement in existing home sales, a 1.3% rise from March to a 4.65 million unit annual rate, was helped by some catchup of sales delayed by bad weather and by surprisingly low mortgage rates, and sales could be helped a lot more in the future by the promised easing of Fannie Mae and Freddie Mac mortgage standards, the National Association of Realtors said Thursday.
Despite the month's increase in sales, the level was still 6.8% behind a year ago and the NAR is sticking with its forecast of a slightly worse year as a whole, even as house prices are expected to rise 6% in 2014.
Positive factors were easy to find, from a moderation in the rate homes are getting more expensive, to the way mortgage interest rates keep backing down, to an average of 4.33% for a 30-year fixed contract in the latest weekly survey of mortgage bankers suggests, NAR Chief Economist Lawrence Yun told reporters.
He had earlier predicted mortgage rates would be up to about 5% by now and he noted Monday's San Francisco Federal Reserve Bank study that singled out mortgage rates as the biggest factor influencing house sales.
Looking ahead, Yun said he sees as good news for housing an easing of mortgage underwriting standards promised last week by Mel Watt, the new head of the Federal Housing Finance Agency that supervises the conservatorship of Fannie Mae and Freddie Mac.
The supply of homes, condos and townhomes available for sale jumped in April by 16.8% to 2.29 million, a backlog which would take 5.9 months to exhaust and a level of supply Yun said is now close to normal. The months' of supply was only 5.1 in March.