Pending home sales rise 7.4%

For Immediate Release On: 10/8/2008

For Further Information, Please Contact:
Alan Zibel - The Associated Press at

Relevant Info on the Web: http://www.denverpost.com/economy/ci_10672509

The highest reading since June 2007 surprised Wall Street, which expected a drop

WASHINGTON — Pending home sales rose 7.4 percent from July to August, an unexpected piece of positive news for the battered U.S. housing market.

The National Association of Realtors said Wednesday its seasonally adjusted index of pending home resales rose to 93.4 from an upwardly revised July reading of 87. The reading was the highest since June 2007.

Home sales are considered pending when the seller has accepted an offer but the deal has not yet closed. Typically, there is a one- to two-month lag before a sale is completed.

Wall Street economists surveyed by Thomson/IFR had predicted the index would fall to 84.9.

The index, which sank to a record low of 83 in March, stood at 85.8 in August 2007.

Sales are picking up in places that have seen the most severe declines in housing prices — including California, Florida, Nevada and Arizona, plus Rhode Island and the Washington, D.C., area, said Lawrence Yun, the trade group's chief economist. Still, Yun does not expect home prices to rebound until next year and expects only a modest gain of 2 percent to 3 percent then.

A major unknown is how the worldwide financial crisis and economic slump will affect the housing market.

Despite numerous efforts by the Federal Reserve to encourage banks to lend more, lenders have kept tight reins on mortgage lending, and average rates on 30-year mortgages have remained over 6 percent for most of the year.

About Trenka & Associates: Trenka & Associates is one of Downtown Denver's leading Real Estate Companies. http://www.condosandlofts.com

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