US pending home sales at six-month high

WASHINGTON: Pending home sales hit a six-month high in April, data showed on June 3, but falling demand for home loans pointed to ebbing activity in the vital housing market due to the expiration of a popular tax credit for buyers.

Still, analysts believe any slowdown in home sales will be temporary, citing a broadening economic recovery, low mortgage rates and strengthening labor market. Data also showed planned layoffs at US companies drifting back to pre-recession levels.

"We have probably set ourselves up for a lower pace of sales in late summer and fall. Fortunately, the very low mortgage rates -- absent a tax credit -- continue to make housing quite affordable," said Craig Thomas, a senior economist at PNC Financial Services in Pittsburgh.

The National Association of Realtors' Pending Home Sales Index, based on contracts signed in April, increased 6% to 110.9 -- the highest level since October and above expectations of a 5% rise. It was the third straight month of gains.

But applications for loans to buy homes dropped last week for the fourth straight week, holding at 13-year lows, the Mortgage Bankers Association said.

The surge in pending home sales, which lead sales of existing home sales by a month or two, reflected a last-minute rush by prospective homeowners to sign contracts before April 30 to qualify for a government homebuyer tax credit. -- Reuters
Looking for properties to buy or rent? With >150,000 exclusive listings, including undervalued properties, from vetted Pro Agents, you can now easily find the right property on Malaysia's leading property portal EdgeProp! You can also get free past transacted data and use our proprietary Edge Reference Price tool, to make an informed purchase.