Gain in Home Sales

According to the National Association of Realtors (NAR), the monthly gain in existing home sales from January to February 2007 was the highest increase the market has seen since March 2004. NAR attributes the gain to a combination of lower home prices, better gas prices, and all-time highs for the stock market.

The existing home sales rose 3.9% in February with a rate of 6.69 million units, up from 6.44 million in January. The increase between months was the biggest monthly rise in three years. (Back in March 2004, sales also rose 3.9%.)

NAR's chief economist, David Lereah, speculated on some of the reasons for the gain. "Some of the rise in home sales may be from mild weather that brought out shoppers in December, but fundamentals have improved in the housing market and buyers see a window now with historically low mortgage interest rates and competitive pricing by sellers," he said. "Even so, winter storms last month [February] discouraged shopping, and buyers were chilled with the third-coldest February on record. These unusual weather patterns mean home sales that close in March may decline before rebounding later this spring."

The positive report is a fresh change among recent "gloom and doom" news relating to the real estate market.