May 2009 Existing Home Sales Rise

2009 June 23

June 23 2009 - Sales of previously owned homes in the United States rose at a slower-than-expected pace in May, an industry survey showed on Tuesday, pointing to a sluggish recovery from the severe economic recession.

The National Association of Realtors said sales rose 2.4 percent to an annual rate of 4.77 million units from a downwardly revised 4.66 million pace in April. That compared to market forecasts for a 4.81 million-unit pace. However, sales increased for a second straight month in May.

A separate survey from the Federal Reserve Bank of Richmond showed a reading of manufacturing sentiment in the U.S. mid-Atlantic states rose to 6 in June from 4 in May and minus 9 in April. However, manufacturers’ outlook for the next six months softened somewhat, signaling conditions remain fragile.

U.S. stock indexes trimmed gains on the data, while Treasury debt prices were unchanged.

“The housing number suggests that things are bottoming, but that’s a far cry from improving. I think the markets are focused on how fast the recovery is going to be, and I think it won’t be as fast as people are thinking,” said Subodh Kumar, chief investment strategist at Subodh Kumar & Associates in Toronto.

The Realtors report showed sales remained down 3.6 percent compared to May last year. The group’s chief economist, Lawrence Yun, said sales in some areas appeared to be losing momentum and blamed the slower rise in May sales to poor home value appraisals, which he said were stalling transactions.

“Pending home sales indicated much stronger activity, but some contracts are falling through from faulty valuations that keep buyers from getting loans,” he said.

“There is danger of a delayed housing market recovery and a further rise in foreclosures if the appraisal problems are not quickly corrected.”

May U.S. existing home sales rise

Home Resales Rise 2.4 percent in May to annual rate of 4.77 million
Lower Home Prices Lure Home Buyers In May

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