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posted: 12/30/2012 8:32 AM

Home sales up for third straight month

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  • AP photoHousing recovery continues to inch forward as pending home sales rose for the third straight month in November.

      AP photoHousing recovery continues to inch forward as pending home sales rose for the third straight month in November.

 
Bloomberg News

Pending home sales rose for the third month in November, a sign of the housing recovery's resilience in the face of fiscal threats facing the U.S.

The index of pending home sales climbed 1.7 percent to 106.4, the highest reading since April 2010, after a revised 5 percent gain in October, the National Association of Realtors reported late last week in Washington, D.C. The median forecast in a Bloomberg survey called for a 1 percent advance.

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Low borrowing costs and stable prices are drawing homebuyers three years after a recession triggered in part by a collapse in housing prices. Fewer foreclosures are coming onto the market, easing concerns that values could fall.

"Housing is building some momentum," Ryan Sweet, a senior economist at Moody's Analytics Inc. in West Chester, Penn., said before the report. "There is a growing perception that now is a good time to buy. Prices are starting to tick up, mortgage rates are still rock-bottom and the job market has shown some signs of improvement."

Pending sales are considered a leading indicator because they track purchase contracts in advance of actual transactions, which are tabulated a month or two later. Existing or previously owned homes account for more than 90 percent of the housing market.

Sales of existing homes reached a three-year high in November, rising 5.9 percent to a 5.04 million annual rate, the Realtor group also reported last week.

New-home sales, also logged when contracts are signed, rose 4.4 percent in November to a 377,000 annual pace, the highest level since April 2010, the Commerce Department reported Thursday.

The average rate on a 30-year, fixed-rate mortgage was 3.35 percent last week, according to Freddie Mac. A late November reading of 3.31 percent was the lowest in data going back to 1972.

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