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Economy in Brief

U.S. Pending Home Sales Rise Further
by Tom Moeller December 1, 2009

Home sales continued to rebound in October, spurred by low interest rates and a tax credit. The National Association of Realtors (NAR) reported that October pending home sales increased 3.7%. It was the ninth consecutive monthly gain and sales are up 41.9% from the low. Consensus expectations had been for a slight m/m sales decline. The index level of 114.1 was at its highest since March 2006. The base for the index is 2001=100.

October sales likely were boosted by the pending expiration of an $8,000 first-time home buyers tax credit. The credit has since been extended into next year.

Only the Western region of the country failed to participate in the October sales gain. Sales reversed the September increase but were still up by nearly one-quarter from last year. Elsewhere, sales in the Northeast more-than made up a September decline with a 19.9% jump. Sales in the Midwest rose 11.6% to the highest level since early-2006. Sales in the South were the laggards again with just a 5.4% gain but they also were up one-third from the January trough.

These home sales figures are analogous to the new home sales data from the Commerce Department in that they measure existing home sales when the sales contract is signed, not at the time the sale is closed. The series dates back to 2001.

The pending home sales data are available in Haver's PREALTOR database. The number of homes on the market and prices are in the REALTOR database.

How Rigid Are Producer Prices? from the Federal Reserve Bank of New York is available here.

Pending Home Sales (2001=100)  October September August Y/Y 2008 2007 2006
Total 114.1 110.0 103.8    31.8% 86.8 95.8 112.1 
  Northeast 100.2 83.6 85.3 44.2 73.1 85.9 98.9
  Midwest 109.6 98.2 90.8 36.5 80.6 89.5 101.9
  South 115.4 109.5 104.6 31.6 89.6 107.3 127.2
  West 127.7 143.8 130.5 22.0 99.5 92.3 109.6

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