Pending U.S. home sales trend upward

Pending home sales jumped in October, showing a positive upward trend
since bottoming in June, according to a forward-looking indicator report
released today by the National Association of Realtors. The Pending
Home Sales Index shows that sales rose 10.4 percent to 89.3 based on contracts signed in October, from 80.9
in September. The index remains 20.5 percent below a surge to a cyclical peak
of 112.4 in October 2009, which was the highest level since May 2006 when it
hit 112.6. According to Lawrence Yun, NAR chief economist, homebuyers are
being drawn to favorable housing affordability conditions. “It is welcoming to
see a solid double-digit percentage gain, but activity needs to improve further
to reach healthy, sustainable levels,” he said. “The housing market clearly is
in a recovery phase and will be uneven at times, but the improving job market
and consequential boost to household formation will help the recovery process
going into 2011.” Yun also predicts that home sales will continue to climb from
their cyclical low this past summer. TRD